India today called for data sharing on taxation and blamed the industrialised and developed world for their reluctance on parting with this information.
"Although it (taxation) is not on the agenda in this meeting, the issue of data sharing is becoming very critical for the developing countries," said India’s Economic Secretary Arvind Mayaram.
He was speaking during his intervention on investment at the G20 Finance Ministers and Central Bank Governors meeting being held during the annual spring meeting of the International Monetary Fund and the World Bank.
"The continuing reluctance of some of the industrialised countries for parting with information under administrative assistance requests is contrary to the spirit of the move towards automatic tax information exchange," Mayaram said.
India would like this to be considered in the next meeting so that jurisdictions are urged to do so in accordance with their treaty obligations, he added.
Mayaram said the International Industrial Working Group should look beyond the conventional solutions like Public Private Partnerships and infrastructure investment funds.
"India has ventured into new and innovative financing structures and avenues of raising capital like Infrastructure Debt Funds and Investment Business Trusts for pooled investment, which are mainly aimed at attracting investments from Pension funds and other cash-rich wealth funds," he said.
He noted that this aspect may be discussed, including the strategy of Pension/Sovereign Funds and the experiences of other members of G20, both as investors and investees.
Mayaram said uncertainty in the credit markets is impacting the ability of infrastructure developers to raise finance for infrastructure projects and undermining confidence in private finance models.
"These ongoing liquidity issues are likely to increase financing costs associated with certain delivery models. Therefore, it is imperative that MDBs are channelled towards funding in emerging economies," he said.
A major issue faced by India and perhaps by other emerging economies as well is that the private finance is exaggerating the risks involved leading to under investment, Mayaram said.
This is a vicious circle, where sovereign rating has over- riding impact on determination of the credit rating of an organisation, irrespective of its inherent strengths or efficiencies.
"This not only makes the raising of funds very difficult especially for new organisations or SMEs, but also makes funds very costly and in process effecting the viability of many of these projects," he said.
"Therefore, excessive reliance on sovereign credit rating is one of the major impediments in raising of funds for the infrastructure development in the emerging economies, which needs to be de-bottlenecked," Mayaram said.
This is the reason why, he added, that India has been insisting for a greater involvement of the MDBs in infrastructure financing to help catalyse private sector flows into the sector.
"This does not mean that we are seeking any concessional finance. We are merely requesting for level playing in the area of infrastructure development," he said.
Mayaram said: "This will not only play a significant role in sustaining the global recovery and re-balancing, but will also contribute to a much needed global demand in the short run.
"In this regard, we urge that the proposed Global Infrastructure Facility at the World Bank must have a more sophisticated design and reflects truly the full commitment of
the member countries, including the industrialised countries."