Project financing must change to spur investments: Kochhar

“To bring back investments, the fundamentals of project financing will have to change. Projects will have to be much more completely tied-up before they get funded,” Kochhar said at the launch of a book, edited by former RBI Deputy Governor Rakesh Mohan, here. 

The ICICI Bank’s MD and Chief Executive said this shall include backward and forward linkages, land availability, natural resources and financial closures. She, however, was quick to add that project finance will continue to be done by banks. 

The comments come amid heavy setbacks faced by lenders on project loans given out over the last few years across all sectors. The setbacks, coupled with external factors which have slowed down demand, have resulted in lenders shifting focus on retail for growth opportunities. 

“A lot more time will be spent on planning before monies get committed. That will be a substantive change in project financing,” she said.