Budget 2021: Massive spending commitment for infra; new DFI on the cards

Institution to have Rs 20,000-cr initial capital; Rs 5-trn lending portfolio target in 3 yrs

The creation of a development finance institution (DFI) will meet one of the major demands of the infrastructure sector. This will not be the first time such an institution will be created for meeting the long-term financing needs of the sector. Union Finance Minister Nirmala Sitharaman announced that a new law will be enacted to create the institution, which will be a provider, enabler, and catalyst for infrastructure financing.

Sitharaman said the government’s National Infrastructure Pipeline (NIP) — that lays specific targets — will require a major increase in funding, both from the government and the financial sector. She planned