On Thursday, the Parliament has approved the creation of the National Bank for Financing Infrastructure and Development. Through this, the country’s infrastructure project will be financed. Let’s know about it …
In order to provide long term funding (money for long term) to the infrastructure projects in the country, government banks are going to be made easy. On Thursday, Parliament approved the bill related to the creation of the National Bank for Financing Infrastructure and Development. The central government will give an initial capital of 20,000 crore rupees to this bank. The bank is planning to raise up to Rs 3 lakh crore capital from the market in the next few years. Through this, the government plans to distribute loans up to Rs 5 lakh crore. Finance Minister Nirmala Sitharaman told Parliament that this step will create new job opportunities in the country. In the budget, announced to spend 5.54 lakh crore rupees on infra projects.
New Government Bank NaBFID
The name of the National Bank for Financing Infrastructure and Development Bank will be DFI (Development Finance Institution). It was approved by the Lok Sabha on 23 March. On Thursday, March 25, it also passed from the Rajya Sabha.
Why is this bank created
It was announced by the Finance Minister in the budget presented on 1 February 2021. He said in his speech that an alternative investment fund was arranged to provide funds to the infrastructure project but had to be scrapped due to several reasons. Banks avoided taking risks for long term. In such a situation, the infra project could not get the money. That is why the government has created a new bank.
Where will the money come from the bank?
Experts say that the infrastructure project requires money for a long time. That is why a separate bank was needed in such a situation.
The central government will give an initial capital of 20,000 crore rupees to this bank. The bank is planning to raise up to Rs 3 lakh crore capital from the market in the next few years. Through this, the government plans to distribute loans up to Rs 5 lakh crore.
Can anyone deposit their money in this bank?
Experts say that large pension funds, sovereign funds and insurance funds will be able to invest in this bank. Experts said that those who put money in it will get many benefits. They will also get indirect tax exemption.
Finance Minister Nirmala Sitharaman said that the DFI will also get several types of tax benefits which will continue for 10 years.
The central government is also going to issue some security for the Development Finance Institution, which will reduce the cost of the funds to be raised through it.
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