Pvt cos not the only core support, FM tells ADB
Finance minister P Chidambaram has asked the Asian Development Bank (ADB) not to solely rely on the private sector for funding infrastructure projects and to continue to engage with the public sector
By TNN |
NEW DELHI: Finance minister P Chidambaram has asked the Asian Development Bank (ADB) not to solely rely on the private sector for funding infrastructure projects and to continue to engage with the public sector. Under the Long Term Strategic Framework (LTSF) of ADB, the private sector would have to play a more important role in development of Asia and Pacific region.
���It is our belief and experience the bulk of the resources for infrastructure would still have to be found through the public sector,��� he said in Madrid at the 41st annual meeting of the ADB. The LTSF projected that by 2020, 50% of its total lending is likely to be through private sector operations.
Mr Chidambaram said: ���The fundamental role of ADB as a multilateral development bank should not be diluted by its over-emphasis on non-sovereign loans at the cost of sovereign loans. A portfolio restructuring plan for ADB to increase the share of private sector in annual loans to 50% will be consistent with the continued need for a vibrant public sector, and this twin strategy will succeed only if total loan approval and disbursement is enhanced significantly.���
Of the $500 billion required by India during 2007-12 in infrastructure, only $150 billion would come from the private sector. ADB should enhance lending to both public sector and private sector, he added. India welcomes ADB���s emphasis on regional co-operation, he said, adding these should be in addition to the national projects and preferably on concessional terms.
As formulated in the strategy, the five core areas of operations include infrastructure, environment, regional co-operation and integration, financial sector development, and education. ���However, we would also like to see more stress on agriculture and irrigation and on health-related infrastructures. It would be both premature and inappropriate for ADB to disengage from agriculture fully. Improvement in irrigation infrastructure is important for increasing food grain production,��� he added.
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