Filling the Fund-Gap

With the need for infrastructure only scaling up, the demand for construction equipment is on a constant rise. Adding to this are the big-ticket face-lifting infra- projects. Equipment Financiers look upon these building infra-requirements as factors broadening the scope of opportunities. Veena Kurup takes a closer look…

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Infrastructure remains as the core determinant of development for any nation. But, to ensure and realise such measures, availability of hassle-free fund flows is a must. With the Indian Government remaining gung ho over its ambitious array of big-ticket and face-lifting projects, the opportunities expected from the construction segment is immense. The evolving infra-constructional development has given an optimistic cheer to the equipment and allied sectors.

While roads and highways continue to hold the major share in pulling the equipment demand index, the opening up of mining sector has broadened the scope of opportunities. Adding to this are the urban rejuvenation programmes, tier-II and tier-III upliftment measures, irrigation and water conservation projects that has opened a new spectrum for the equipment manufacturers. Despite these opportunities the industry had to face its fair share of slowdown owing to the market and economic volatilities – in turning limiting the hassle-free flow of funds.

The Funding Need

As per a recent study released by the China-led Asian Infrastructure Investment Bank, the cost of infrastructure financing in India is anticipated to scale up over the next one year. Global economic conditions, higher borrowing rates and geopolitical volatilities were pointed as the areas of concern affecting the investors while chipping in finance for the infra and allied sectors.