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NBFID Bill ( National Bank for Financing Infrastructure and Development ) passed by parliament
Two minute reads :
- The National Bank for Financing Infrastructure and Development Bill passed by the Lower house of the parliament.
- The DFI will also be able to borrow money from RBI against bills of exchange or promissory notes arising out of bona fide commercial or trade transactions.
- It aims at establishing institutions to provide support to the development of long term infrastructure financing in the country.
- Initially, the central government will own 100 % shares of the institution which may Subsequently be reduced up to 26%.
- The National Bank for Financing Infrastructure and Development will set up with a corpus of ₹ 20,000 crore and the government will give initial grant of ₹ 5,000 crore.
- The government expects the DFI to leverage this fund to raise up to ₹ 3 lakh crore in next few years.
- The development finance institutions promoted by the private sector will get five year tax exemption to begin with, which can be extended by another five years.
Functional of NBFID :
- NBFID will have both financial as well as development objectives.
- Financial objectives will be to directly or indirectly lend, invest, or attract investments for infrastructure projects.
- Development objectives include facilitating the development of the market for bonds and loans for infrastructure financing.
Management of NBFID
NBFID will be governed by the members of Board of Directors, include ;
- The chairperson appointed by the central government
- A managing director
- Three Deputy managing directors
- Two directors nominated by the central government
- Three directors elected by shareholders
- A few independent directors
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