The infrastructure sector got a boost after Finance Minister Nirmala Sitharaman on Saturday announced incentives for sovereign wealth funds to invest in this space.In her Budget speech, the Finance Minister proposed 100 per cent tax exemption to SWFs on interest, dividend and capital gains income earned from any investment made in infrastructure and other notified sectors till March 31, 2024 with a minimum lock-in period of three years.A 100 per cent tax reduction in infrastructure investment for sovereign wealth funds will be a big boost for infra financing, said Jaspal Bindra, Executive Chairman, Centrum Group.,Nilesh Shah, MD - CEO, Envision Capital, said the incentives offered to sovereign wealth funds are very positive.
We will get quality investors and quality money in a lot of big-bang infrastructure projects.
This is a huge positive for the overall investment cycle and for the infrastructure sector, he said.The Finance Minister also proposed an increase in FPI (foreign portfolio investment) investment limit in corporate bonds to 15 per cent and allowed NRIs to increase investment in government bonds and securities.
Bindra believes these moves will bring in long-term foreign capital to the country.Overseas investors on Saturday sold shares worth Rs 1,199.53 crore in the cash market, according to the data available with NSE.Ajit Mishra, VP Research, Religare Broking, said the move is positive for infrastructure major L-T.
Alok Deora, an analyst at YES Securities said infrastructure investment trusts (InvITs) will benefit from the incentives offered for sovereign wealth funds.