Oman’s sovereign wealth fund is planning to start a $1 billion infrastructure fund to boost investment in projects including the Gulf state’s road, transport and energy systems, said a report.

The State General Reserve Fund is talking to international banks and potential investors for the financing, reported Bloomberg, citing people familiar with the matter who did not want to be identified because the information is private,

The projects, in which the funds will be deployed, have not been finalised, they stated.

The country is turning to public-private partnerships to plug gaps in its infrastructure programme, which is being hindered by tighter government finances, said the report.

The Middle East’s biggest non-Opec oil producer last week became the first developing nation to tap international capital markets by issuing $6.5 billion of five-, 10- and 30-year bonds, fuelling concerns an increase in debt may pressure its credit ratings.

Oman, like other states in the oil-rich six-nation GCC, has been battered by a plunge in crude prices since mid-2014 that has caused budget deficits to swell and borrowing to surge, said the Bloomberg report.

The nation’s bonds are rated junk by S&P Global Ratings and have among the lowest investment grades from Moody’s Investors Service and Fitch Ratings.

Oman’s capital market authority introduced regulations for real estate investment funds at the start of this year in a bid to stimulate the property sector.