Infrastructure sector needs more equity flows, says Oscar Fernandes

NEW DELHI: Amid sluggish progress in many projects, Union Minister Oscar Fernandes today pitched for increased equity flows into the infrastructure sector which has been over-reliant on debt.

The Road Transport and Highways Minister also emphasised that there is an urgent need to step up investment in the infrastructure sector.

Noting that many infrastructure projects are under stress, he said various options should be looked at to tackle the crisis-like situation.

"There has been an over reliance on debt. Infrastructure companies are over leveraged and the flow of equity in infrastructure projects has been very minimal.

"Experts have started questioning PPP projects and are concerned it is becoming a public only venture," Fernandes said in his address to the Delhi Economics Conclave here.

According to him, it would be prudent to substitute the promoter and change the management of a project rather than wait for it to become a non-performing asset.

L&T Infrastructure Development Projects' Chief Executive and Managing Director K Venkatesh said that the sector is facing many problems.

He suggested various steps, including inflation-linked cost overrun protection for project developers in case of delays due to reasons beyond their responsibility.