New Delhi, Sep 15 (IANS): The target of $500 billion investment on infrastructure development during the next Five Year Plan (2012-13 to 2016-17) is likely to fall short by 10-12 percent, Planning Commission Deputy Chairman Montek Singh Ahluwalia said Thursday.

"I would not be surprised if it is 10 percent or even 12 percent short," Ahluwalia told reporters on the sidelines of a conference organised by the Federation of Indian Chambers of Commerce and Industry here.

Prime Minister Manmohan Singh recently announced that nearly $1 trillion would be spend on infrastructure development during the 12th Five Year Plan that starts from April 1, 2012. Of the amount, half would come from the private sector.

Ahluwalia said private investment might fall a little short of the target.

"I think total investment will probably be little short of the $500 billion target," he said.

Ahluwalia said the government would create at least two debt funds this financial year with a corpus of $10 billion each to help finance infrastructure projects in the country.

"We need several $10 billion funds. I expect at least two will be set up this year."

Earlier, addressing FICCI's India Infrastructure Summit, Ahluwalia emphasised on the need for government scrutiny of private sector projects on the pattern of public sector projects.

"It should be logical to open the private sector projects to government scrutiny in terms of assessing the performance parameters so that infrastructure projects do not suffer from time and cost overruns," he said.

Ahluwalia said the Planning Commission was undertaking detailed exercises to sort out issues related to land acquisition, environmental and forest clearances and inter-sectoral linkages.

These would be part of the operational details currently being worked upon and would be built into the final plan document that will be ready by the end of the current financial year, he said.