Beijing: Pitching for large scale Chinese investments into India's massive infrastructure expansion plans, NITI Aayog Vice Chairman Arvind Panagariya has said China should make its loans attractive compared to Japan's “incredibly attractive” finance.
Panagariya, who attended round-table on India-China economic cooperation between NITI Aayog and China's Development Research Centre (DRC) early this week, said China which is pushing for its investment in big ticket infrastructure projects in India like the high speed train should make its loans more attractive.
“High speed rail is an expensive proposition. What kind of finance Chinese are willing to bring to the table is important. Japanese are bringing incredibly attractive finance to the table.
“They are offering 40-year loan where there is no payments for 10 years and after that only 0.3 per cent a year. So it is a highly concessional loan. Chinese are not offering anything close to that. So there is big difference what Chinese offer and that of Japanese,” he told PTI. China is vying with Japan to build bullet trains in India.
While Japan is currently conducting feasibility study for Mumbai-Ahmedabad bullet train, China has undertaken a similar exercise for Chennai-New Delhi corridor. “Eventually we need high speed rail. Fiscal constraints we face.
Land is a problem, which we must solve and is solvable. That does not worry me so much. Finance is important. If we are getting limited amount of finance, then we have to make a decision to use of high speed rail or expand the electrification of existing railway,” he said.
India has sought China's assistance to increase the speed of the existing network as well as modernisation of some the railway stations.
China's out bound investment in different parts of the the world rose to USD 95.21 billion in the first ten months of this year, registering an increase of 16.3 per cent.
Last year, China's ODI amounted to USD 102 billion making it third biggest investor after the US and EU. Chinese officials say Chinese investments in India so far amounted to about USD three billion.
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