The government on Thursday announced it decision to invest $4.3 billion (Rs 27,000 crore) the World Bank's special private placement bonds (SPPBs) so that the country could remain eligible for the global lender's low-cost funding for various domestic infrastructure projects.

The investment will allow India to borrow $4.3 billion from the World Bank, over & above the single borrower limit of $17.5 billion.

The government said that the additional borrowing space would help it complete its planned infrastructure projects with the assistance of the International Bank for Reconstruction & Development (IBRD).

Economist Dharmakirti Joshi, from ratings agency Crisil, said, "This is a confidence-enhancing measure. Keeping all funding sources accessible at a time when government finances are tight is a good move."

Joshi added that the move would increase supply of dollars and help in alleviating funding constraints for large investment projects.

To fund the government's proposed huge investment; the Reserve Bank of India (RBI) will use the country's foreign exchange (forex) reserves, which stood at $275 billion at the end of August this year.