Budget 2011: Will infrastructure bonds get tax benefit of up to Rs 1 lakh?
The budget expectations include an increase in deduction limits under Section 80C for infrastructure bonds and raising the disbursement target for IIFCL.
By TNN |
MUMBAI: The government is expected to come up with measures to promote alternative sources of infrastructure funding in the Union Budget since an increased dependence on banks has resulted in the banking industry being overexposed to the core sector.
The Economic Survey released by the finance ministry on Friday said, “Financing infrastructure would be a big challenge in the coming years and to meet the challenge some innovative ideas and new models of financing would be required.”
The budget expectations include an increase in deduction limits under Section 80C for infrastructure bonds and raising the disbursement target for IIFCL. Also, there has been a demand from banks to float infrastructure bonds with tax saving features.
“There is a possibility of an extension of the benefit under section 80CCF from Rs 20,000 to Rs 1,00,000. This can help improve financing for the sector,” said Prabhat Awasthi, MD & head of equities research, Nomura, in a report.
Net bank credit to infrastructure increased 59% to Rs 1,02,301 crore during April-November 2010 over the corresponding period in the previous fiscal.
However, FDI inflows during April-November 2010 have been low compared to the year-ago period.
The Economic Survey released by the finance ministry on Friday said, “Financing infrastructure would be a big challenge in the coming years and to meet the challenge some innovative ideas and new models of financing would be required.”
The budget expectations include an increase in deduction limits under Section 80C for infrastructure bonds and raising the disbursement target for IIFCL. Also, there has been a demand from banks to float infrastructure bonds with tax saving features.
“There is a possibility of an extension of the benefit under section 80CCF from Rs 20,000 to Rs 1,00,000. This can help improve financing for the sector,” said Prabhat Awasthi, MD & head of equities research, Nomura, in a report.
Net bank credit to infrastructure increased 59% to Rs 1,02,301 crore during April-November 2010 over the corresponding period in the previous fiscal.
However, FDI inflows during April-November 2010 have been low compared to the year-ago period.
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