Infrastructure prime issue in Budget: Goldman

New Delhi: With infrastructure bottlenecks plaguing the economy, financial services provider Goldman Sachs expects the upcoming Budget to provide a big stimulus to this core sector, particularly roads and ports.

Goldman Sachs expects speedy regulatory approvals, more budgetary allocation, and the setting up of a "Roads Finance Corporation" to fund road projects, which would securitise its income and list on the stock exchange, among others.

Liberalising investment guidelines for insurance and pension funds in related sectors, increasing the exposure limits of banks for specific sectors; and giving a big push to Public Private Partnership projects in infrastructure

are on the cards, said Goldman Sachs.

For the power sector, the financial services firm expects the Budget to contain significant increases in spending, including for generation, rural electrification, and for minimising transmission and distribution losses.

Other measures which the Budget may announce on infrastructure would be to give greater flexibility to the Infrastructure Investment and Financing Company Ltd which has been set up as a refinancing facility for

infrastructure projects, to deploy funds.

It further said the Government has identified infrastructure as a key thrust area. Both the manifesto of the Congress and President Pratibha Patil's speech to the joint session of Parliament outlined the policy priorities for the

new Government in this regard.

"Infrastructure remains woefully under supplied in India according to the Planning Commission, India may need to nearly double its ports, roads, power, telecom, and airports capacity," it added.

Goldman Sachs further said that a change of guard at the Ministry of Surface Transport is giving the roads sector a big impetus. Senior Congress leader Kamal Nath is the Cabinet Minister in this portfolio, while in the previous UPA regime DMK's T R Baalu held the ministerial post.

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