State-owned financing firm India Infrastructure Finance Company (IIFCL) will soon provide money to banks for lending to infrastructure sector projects out of the proceeds of Rs 10,000-crore tax-free bonds as some issues related with refinancing have been resolved.
The Empowered Committee of Secretaries has decided to allow refinancing not only to banks but also to select non- banking finance companies, sources said.
In addition, it has been decided to expand the ambit of refinancing by including ultra mega power projects and railways, sources said.
As per the earlier government mandate, the Rs 10,000 crore fund would be utilised for refinancing banks for up to 60 per cent of their loans to new road and port projects, where bids have been submitted on or after January 31, 2009.
The National Highways Authority of India has cleared 30 projects which would soon require funding, sources said.
IIFCL and banks are equipped to support projects involving investment of Rs 1,00,000 crore in infrastructure, sources added.
The fund was raised in the last fiscal. As per the stimulus package, IIFCL was authorised to raise another Rs 30,000 crore during the current fiscal.
However, it is unlikely that IIFCL will raise Rs 30,000 crore as it has not utilised the fund alloted last year.
