India Infrastructure Finance Company Ltd (IIFCL) has urged the Government to frame a bankruptcy code. Such a code should be introduced if the country wants to develop an infrastructure bond market, Mr S.K. Goel, Chairman and Managing Director, IIFCL, said here on Monday.
Addressing a conference on the public private partnership (PPP) in State Highway roads, organised by the Planning Commission, Mr Goel added that each State should prepare a roadmap of the number of roads that would be required at the highway, district and rural level in the next five years.
“Once this (roadmap) is done, we will be able to estimate their funding requirement,” he said. Mr Goel also advised States to set up their own State Road Fund by putting a levy on the vehicles registered in their State.
Mr Goel also highlighted that financing long-term infrastructure projects are very difficult for banks as they are faced with asset liability mismatches. He pointed out that 81 per cent of their deposits mature in less than five years. He also said that IIFCL has come up with take out financing scheme, which has been approved by the Government.