NBFID TO START OPERATIONS
- The National Bank for Financing Infrastructure and Development (NBFID) is set to start its lending
- operations with 190-200 big infrastructure projects in roads, railways, and energy sector.
Highlights
- This announcement was made by newly appointed Chairman of NBFID, K V Kamath.
- Central government had announced the appointment of K V Kamath as the chairperson of the newly set up NBFID.
- NBFID was set up with the aim of catalysing investment in fund-starved infrastructure sector in India.
- Under the National Infrastructure Pipeline (NIP), there are 193 projects above Rs 1,000 crore each.
- NIP with an ambition of USD 1.5 trillion covers key sectors like roads, metro, railways, and energy. It also includes some social projects like irrigation projects.
About NAFID
- NBFID was set up as a corporate body, with an authorised share capital of one lakh crore rupees.
It was set up with following objectives:
- To directly or indirectly lend, attract investment or invest for infrastructure projects that are located entirely or partly in India.
- To facilitate the development of market for loans, bonds, and derivatives for infrastructure financing.
Functions of NBFID
Main functions of NBFID are:
- To extend loans and advances for infrastructure projects.
- To take over or refinance such existing loans.
- To attract investment from private sector investors as well as institutional investors for infrastructure projects.
- To organise and facilitate foreign participation in infrastructure projects.
- To facilitate negotiations with several government authorities for dispute resolution with respect to infrastructure financing.
- To provide consultancy services in infrastructure financing.
How NBFID raises fund?
- NBFID raises money in the form of loans or otherwise in Indian rupees and foreign currencies. It also raises money by issuing or selling financial instruments like bonds and debentures.
- It can also borrow money from central government, Reserve Bank of India, mutual funds, scheduled commercial banks besides multilateral institutions like Asian Development Bank and World Bank.