National Bank for Financing Infrastructure and Development | 14 Sep 2024

Source: BS

Recently, the Government of India in consultation with the Reserve Bank of India (RBI) has notified the National Bank for Financing Infrastructure and Development (NaBFID) as a “public financial institution” under the Companies Act, 2013 aiming to boost infrastructure financing in the country.

• The Companies Act of 2013 regulates incorporation, responsibilities, directors, and dissolution of companies. It partially replaced the Companies Act, 1956.
• This notification enhances NaBFID's capacity to fund large-scale infrastructure projects, strengthening the national infrastructure finance system.
• NaBFID, established in 2021 by the National Bank for Financing Infrastructure and Development Act (2021) as India's fifth All India Financial Institution (AIFI) to support long-term infrastructure financing, including the development of bonds and derivatives markets.
  • As of February 2024, NaBFID as a specialised Development Finance Institution (DFI) has sanctioned over Rs 86,804 crore for infrastructure projects across the country, with 50% of the sanctions having long tenures of 20 to 50 years. NaBFID plans to sanction over Rs 3 lakh crore by March 2026.
• Other Four AIFIs:
  • Export-Import Bank of India (EXIM Bank)
  • National Bank for Agriculture and Rural Development (NABARD)
  • National Housing Bank (NHB)
  • Small Industries Development Bank of India (SIDBI)

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