Finance Minister Nirmala Sitharaman may announce a national bank to finance infrastructure projects in the upcoming budget.
Various reports suggest that the ministry of finance has prepared a draft of the bill called - the National Bank for Financing Infrastructure and Development Bill, 2020.
The proposed bank may have an authorised capital of one lakh crore rupee and twenty thousand crore rupees as an initial paid-up capital.
This bank is likely to replace India Infrastructure Finance Company Limited (llFCL) with higher power and autonomy. The purpose of setting up this bank is to finance the National Infrastructure Pipeline, reports said.
The government may make it mandatory for Provident Fund, Pension and Insurance Funds to put a certain amount to this bank.
The National Bank will not only provide long-term financing for infrastructure projects, but also ensure the financial closure of projects. Apart from these activities, the bank will also engage in monetisation of the project and regular monitoring for timely completion.
The government has planned a total infrastructure investment of Rs 11.1 lakh crore in the next five years.
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