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Modi meets foreign investors today as India looks to attract investments for infrastructure

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Prime Minister Narendra Modi will woo the world’s 20 largest pension and sovereign wealth funds at a virtual roundtable Thursday as India looks to attract investments for its ambitious Rs 111 lakh crore infrastructure investment pipeline for the next five years.

The Modi government’s efforts to attract foreign investments into the infrastructure space comes at a time when around half of the proposed infrastructure investments by 2025 will have to come from private and foreign investors.

The government is banking on infrastructure to be the growth driver for the economy that is expected to contract by double digits in 2020-21.

To attract these funds to invest in India, it has already announced tax exemptions in this year’s budget to these long-term funds investing in infrastructure, making their income exempt from long-term capital gains, interest and dividend tax.

After stagnating for three years around the $60 billion level, FDI inflows into India rose sharply in 2019-20 to $73.4 billion. The inflows have been steady this fiscal as well, despite the Covid-19 pandemic. In the April-August period, India received $35.7 billion of inflows, according to data with the Department for Promotion of Industry and Industrial Trade.

The virtual global investor roundtable, organised by the Ministry of Finance and the National Investment and Infrastructure Fund, will be attended by global investors who represent regions like the US, Europe, Canada, Korea, Japan, Middle East, Australia and Singapore, and have an asset under management of $6 trillion, the Prime Minister’s Office said in a statement.