Forex pile to fund infrastructure?

In a bid to boost infrastructure for achieving 7-8 per cent economic growth, the Planning Commission has suggested to the prime minister an investment of up to $30 billion from the burgeoning foreign exchange reserves of over $100 billion in the country.

At the same time, it has advised a cautious approach to ensure that it does not have an inflationary effect, sources said.

The suggestion from Deputy Chairman of the Planning Commission Montek Singh Ahluwalia, who has been entrusted the responsibility of preparing a strategy for faster development of infrastructure like roads, port and power, is understood to have been sent to the Prime Minister Manmohan Singh recently in a letter.

Ahluwalia, who is at present accompanying the Prime Minister on his visit to the United Kingdom and the United States of America, is understood to have suggested formulation of a strategy while taking inputs from the Reserve Bank of India and the finance ministry.