Managing Financial Crisis Successfully in Infrastructure Sector-Role of Proactive Strategies in This Perspective

Abstract

The Ministry of Finance and Department of Economic Development hold that economic development of India is directly connected with availability of basic and modern infrastructure in India. Infrastructure development is the key to sustaining healthy GDP growth in India.

The global financial crisis has had a widespread impact on the infrastructure sector in India. The impact of the Crisis on commercial bank finance was manifested in higher interest costs in the immediate aftermath of the Crisis in India The Government of India has now formulated different policies to facilitate India Infrastructure Fund accumulation. The main sources of finance for infrastructure sector in India have been government budget, multilaterals, specialized institutions, commercial bank finance, foreign bank finance, equity finance, and private participation in different projects including project finance. Encourage the Private Sector to take up the bulk of the upgrade projects can be used as a tool of managing financial risk in infrastructure. Strong and timely policy interventions factors-a fundamentally strong macro economy, pro-active monetary policy management, prudent foreign debt management, substantial foreign exchange reserve cover, high savings rate, and a healthy financial sector were a key to manage crisis, building confidence and recovery.