The investment in the infrastructure sector of the country in different avenues can transmit into a manifold effect leading to better GDP growth and inclusive employment generation. Discuss (200 Words)
Refer - Financial Express
Enrich the answer from other sources, if the question demands.
IAS Parliament 5 years
KEY POINTS
· The recent announcement of `102 lakh crore by the finance minister was shot in arm for acceleration of mega infrastructure projects allocated across the various sectors like power, railways, urban irrigation, mobility, education and health. This will spur up the demand for alternative infrastructure projects funding.
· It is difficult to fund new projects due to limited availability of capital and liquidity with the Banks/NBFCs and Bank’s sectoral limits.
Alternative funding avenues
· The government needs to encourage privatisation. In India, the government has only issued sovereign bonds in local currency in the domestic market to finance the fiscal deficit.
· Foreign portfolio investors have evinced interest in Indian government bonds traded locally in recent years, as the real interest rate on Indian bonds is attractive compared to other developed economies.
· There is a need to construct a financial bond market which runs for five years and moves assets into a 20-30 year bond / InvIT, essential to ensure constant capital flows.
· Mobilising funds via divestment of profit-making state-run companies and revive private participation to fill the financing gap.
· Disinvestment provides the government the much-needed fiscal resources and withdrawal from several activities that can be transferred to private sector without sacrificing any public cause.
Inclusive employment
· Better allocation of funds and utilization of resources automatically leads to employment generation.
· But the fault lines in the society wth respect to employment must be avoided by recognizing the talents rather than social identities.
· Human capital formation is a crucial factor in generating inclusive employment.
Shantanu tiwari 5 years
Please review
IAS Parliament 5 years
Try to include data to support your arguments. Keep Writing.
Shivangi 5 years
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IAS Parliament 5 years
Try to include about alternative funding avenues. Keep Writing.
HB 5 years
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IAS Parliament 5 years
Need for infrastructure is not needed. Avoid listing out points and try to elaborate. Keep Writing.
