PM Modi's Cabinet clears Rs 500 crore project development fund for Asian region
The Union Cabinet on Wednesday cleared a proposal to create a Rs 500 crore project development fund to increase economic presence in Cambodia, Laos, Myanmar and Vietnam, which can act as gateways for market access to China and the European Union (EU).
"Cabinet approves creation of a Project Development Fund (PDF) to catalyse Indian economic presence in Cambodia, Laos, Myanmar and Vietnam," said an official release.
The Cabinet, chaired by Prime Minister Narendra Modi, approved creation of a PDF with a corpus of Rs 500 crore for catalysing Indian economic presence in these nations, it said.
The PDF will be housed in the Department of Commerce. Exim Bank will operate the fund.
"The PDF shall be governed by an Inter-Ministerial Committee under the chairpersonship of the Commerce Secretary," the release said.
The CLMV nations - Cambodia, Laos, Myanmar and Vietnam - have a unique position in the regional value chains and offer a gateway for market access to China/EU and other markets due to various trade agreements.
India will have the advantage in the regional value chain by securing a dedicated market for domestic raw materials and intermediate goods on a long-term basis.
The regional access will also help India with availability of inputs and raw materials for Indian industry.
Despite plenty of opportunities in the CLMV region, Indian businesses in these countries so far have been constricted due to limited information, infrastructure and other contingent risks.
Government said the PDF will benefit India's industrial community for business expansion and maintaining cost competitive supply chains, besides integrating with global production networks.