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Govt seeks Rs11,800 cr central assistance for state VGF scheme
27 Oct 2009
Gandhinagar: The state government has sought financial assistance of Rs11,800 crore for its viability gap funding (VGF) scheme. As per the state government's estimate, the total amount required for the support to infrastructure project in Gujarat under the VGF scheme will be around Rs35,401 crore, out of which the state government will make provision for Rs23,601 crore, while for the remaining portion, the government has sent a proposal to the Centre seeking assistance of Rs11,800 crore.
According to highly placed sources in the government, a joint survey conducted jointly by the agency Crisil and the state government reveals that investment of around Rs.559,000 crore is expected in various infrastructure projects in the state during the period from 2010-15. Out of this, 66% investment is expected under PPP model. So the investment eligible for VGF support stands at around Rs3,57,600 crore.
Even if 50% of this investment materialises, which works out to be Rs1,78,800 crore, the government will have to provide assistance of Rs35,401 crore at the rate of 20% of the total investment. So the government has sent a formal proposal to the central government seeking assistance.
The state government intends to create huge infrastructure around DMIC (Delhi Mumbai Industrial Corridor) and DFC (Dedicated Freight Corridor) project areas. "Gujarat government has announced state VGF scheme to support the PPP (Public Private Partnership) model for the infrastructure projects. The scheme is similar to VGF scheme announced by the Centre.
It provides for capital grant to PPP projects up to 20% of the total project cost. The eligible sectors under the scheme include roads and bridges, railways, seaports, airports, inland waterways, power, urban transport, water supply, sewerage, solid waste management and other physical infrastructure in SEZs, international convention centres," the sources said.
The VGF scheme announced by the state government also includes some other infrastructure projects, which are not included in the central VGF scheme.The state government has envisaged investment of around Rs.23,000 cr in five most important projects to be taken up on high priorities for DMIC in Gujarat. These projects include Ahmedabad-Gandhinagar-Dholera metro rail, Dholera international airport, Ahmedabad-Dholera logistic park, GandhidhamSamakyali logistic park and Dahej-Bharuch logistic park.
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