Finance minister Nirmala Sitharaman may announce a national bank in the upcoming Budget 2021 on February 1 for easy access to low cost fund for big infrastructure project, reports CNBC.
Sources have said that government may make it mandatory for Provided Fund, Pension and Insurance Funds to put a certain amount to this bank.
The proposed bank may have an authorised capital of Rs 1 lakh crore and Rs 20,000 crore as initial paid up capital, the report said.
Multiple sources confirmed to CNBC that the bank will likely be set up by the government through a special law.
CNBC reported finance ministry sources as saying that the government has prepared a draft of the bill called- National Bank for Financing lnfrastructure and Development Bill, 2020 to set up the back that is likely to replace the lndia lnfrastructure Finance Company Ltd. It is learnt that this bank will have higher power and autonomy.
Reports suggest that the purpose of setting up this bank is to finance the National Infrastructure Pipeline.
The National Bank will not only provide long-term financing for infrastructure projects, but also ensure the financial closure of projects. It will also ensure any such project is close on time.
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