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$267 billion investment required in infrastructure by 2006: Sinha

Finance Minister Yashwant Sinha, on Wednesday, invited domestic and foreign investors to participate in India's ambitious plan of further developing its power, telecom, road and port sectors, requiring investment worth over $267 billion in the next five years.

"The government has drawn up an ambitious plan of action in four major sectors -- power, telecom, ports, airports and roads. Such an ambitious plan of development offered unprecedented opportunities for investors, both domestic and foreign, for making profitable and safe investments in a country which is clearly on the move," Sinha said addressing an investor meet in Hong Kong.

The government proposes to add 1,11,500 MW of power at an investment of $178 billion and 52 million additional telecom lines requiring $ 55 billion dollar by 2006, he said at the 'India Session' of Credit Lyonnaise Securities Asia - Emerging Markets' session.

In the road sector, the country requires an investment of $ 27 billion and another $ 7.3 billion in the port sector during the same time-frame, Sinha said.

In order to ensure higher foreign investment inflow, he said "the foreign direct investment regime has been further liberalised and made investor and market friendly."

"The opening of several sectors to 100 per cent foreign participation through the automatic route would substantially cut down procedural delays and remove the 'hassle factors', which were perceived by foreign investors as impediments to FDI flows vital to India's infrastructural development," Sinha said.

Sinha appealed to the 350 odd foreign institutional investors and fund managers to participate in India's developmental effort and assured them of "equitable and fair" returns on their investments.

In order to attract substantial investments, he said the government has offered tax breaks involving sufficient periods of tax holidays.

Sinha said the recent budget had carried forward the reforms in the financial sector and contained a number of stipulations to further strengthen the confidence of foreign investors.

Referring to the South Asia currency crisis of 1997-98, he said the Indian economy had not been affected by the meltdown, which was demonstrated by the confidence the FIIs reposed in the Indian stock market by ensuring that no capital flight took place at that time.

Sinha said the market regulator was taking further steps including introduction of rolling settlements and doing away with carry forward systems, with a view to minimising market manipulations and bring in complete transparency in market operations.

Commenting on the recent volatility in India's stock markets, Sinha allayed the fears of foreign investors regarding any payment crisis and said "all settlements had been made as per market requirements and regulations."

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