NEW DELHI: The government has decided to leave it on the new management of the development financial institution (DFI) to decide on a merger of India Infrastructure Finance Company (IIFCL) or other entities with itself.
Officials told TOI that the government does not want to burden the new entity with legacy issues and wants it to start on a clean slate. “Let the new board decide whether it wants to take over the burden of an existing company and let them decide who they want in their fold,” a source said.
The move will come as a major relief for IIFCL management, which has been lobbying against a merger, although it may prove to be detrimental for the NBFC in the long run and comes with the risk of turning it into an organisation like IFCI, India’s first DFI, which has been surviving for over two decades but has little to contribute.
FM Nirmala Sitharaman had announced the establishment of the new DFI, called National Bank for Financing Infrastructure and Development, in her last Budget and is aimed at being a one-stop shop for all infrastructure related services. While the law to set up the institution, which will come with government funding, has been enacted by Parliament, the finance ministry has tasked Sidbi to do the groundwork and appoint a consultant. The DFI is the latest experiment .
Officials told TOI that the government does not want to burden the new entity with legacy issues and wants it to start on a clean slate. “Let the new board decide whether it wants to take over the burden of an existing company and let them decide who they want in their fold,” a source said.
The move will come as a major relief for IIFCL management, which has been lobbying against a merger, although it may prove to be detrimental for the NBFC in the long run and comes with the risk of turning it into an organisation like IFCI, India’s first DFI, which has been surviving for over two decades but has little to contribute.
FM Nirmala Sitharaman had announced the establishment of the new DFI, called National Bank for Financing Infrastructure and Development, in her last Budget and is aimed at being a one-stop shop for all infrastructure related services. While the law to set up the institution, which will come with government funding, has been enacted by Parliament, the finance ministry has tasked Sidbi to do the groundwork and appoint a consultant. The DFI is the latest experiment .
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