View: Is Development Finance Institution new wine from an old bottle?
The idea of a development finance institution can be dismissed by some as old wine in a new bottle. But the nation could well savour it if the brew is different.
Synopsis
For any development finance institution to be viable, two things have to be in place — funds that would be available for 10-15 years, and projects that earn income for the investing institution. The framework, as announced by Sitharaman on Tuesday, is sketchy for now.
India’s quest for funds to build infrastructure is never ending. Over the decades, it has taken many forms, but almost every one of them ended up in failure. With Nirmala Sitharaman announcing on Tuesday that the Union Cabinet has cleared a Bill to set up a GoI-owned development finance institution (DFI), here comes another go at it.