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Government to provide 30% viability gap funding for social infrastructure projects: FM Nirmala Sitharaman

FM Nirmala Sitharaman said that social infrastructure projects suffer from poor viability and that the government will enhance the quantum of VGF up to 30 percent each of the total project cost.

May 16, 2020 / 07:39 PM IST

Finance Minister Nirmala Sitharaman, on May 16, said that the government would provide 30 percent viability gap funding (VGF), against the 20 percent given earlier for social infrastructure projects.

The finance minister said that the revamped Viability Gap Funding Scheme would help boost private sector investment in social infrastructure projects.

Social infrastructure projects suffer from poor viability and that the government will enhance the quantum of VGF up to 30 percent each of the total project cost, FM Sitharaman added.

For other sectors, existing VGF support of 20 percent each from the Centre and states shall continue. The total outlay is Rs 8,100 crore, the finance minister said.

These projects will be proposed by Union Ministers and state governments or statutory entities.

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The finance minister was unveiling the fourth tranche of details of the COVID-19 economic relief package on May 16.

Follow our LIVE blog for the latest updates from FM Nirmala Sitharaman’s press conference

Focusing on announcements related to structural reforms, FM Sitharaman, during the press conference, also said that many sectors needed policy simplification and that Prime Minister Narendra Modi had a track record in taking up deep and systemic reforms.

FM Sitharaman listed structural reforms in eight sectors, including defence production, civil aviation, coal and minerals, space and atomic energy. The finance minister said that these structural reforms would boost investment and job creation.

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Moneycontrol News
first published: May 16, 2020 05:17 pm