Banks pitch for tax free infra bonds
January 19th, 2012 - 8:31 pm ICT by IANS
New Delhi, Jan 19 (IANS) Commercial banks should be made eligible to issue tax free infrastructure bonds, top executives urged Finance Minister Pranab Mukherjee Thursday, saying this would help mobilise greater resources for infrastructure development in the country.
During a pre-budget consultation, chairpersons and managing directors of banks and financial institutions urged the finance minister to provide “special incentives for investors” to invest in infrastructure bonds.
“The requirement for special incentives for investors to invest in infrastructure bonds was highlighted. A need for clarity and broadening of the definition of the infrastructure was also raised,” according to an official statement released after the meeting.
The bankers suggested that infrastructure should be taken as a priority sector and there should be an independent regulator for infrastructure.
They also suggested that a single window clearance system should be put in place for infrastructure sector.
During the meeting Mukherjee urged the banks to play an active role in overcoming the current challenges facing the economy.
“All banks and financial institutions whether public or private have a common goal of working towards a healthy economy. We should work together to attain this common objective,” Mukherjee said.
The finance minister said India’s gross domestic product (GDP) growth was likely to remain around 7.2 percent in the financial year ending Mar 31, 2012.
He also said that it would be difficult to meet 4.6 percent fiscal deficit target as projected during the budget last year.
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Tags: budget consultation, clearance system, commercial banks, common goal, deficit target, finance minister, financial institutions, fiscal deficit, free infrastructure, gdp growth, gross domestic product, independent regulator, infrastructure bonds, infrastructure development, infrastructure sector, jan 19, New Delhi, pranab mukherjee, priority sector, top executives