India's Largest Database on New Projects
RBI nod to invest major forex reserves
November 13, 2007: The Reserve Bank of India has given an in-principle approval to invest $5 billion of foreign exchange reserves annually in infrastructure projects through two subsidiaries of India Infrastructure Finance Company (IIFCL).
The government is still in talks with RBI as certain issues still remain and needs to be addressed.
The RBI board has given in-principle approval in respect of the SPV to be created for borrowing funds from the RBI and lend to Indian companies implementing infrastructure projects in India, or to co-finance their external commercial borrowings for such projects solely for expenditure outside India.
As per the Plan panel estimate, India needs investments worth $492 billion till 2012 for infrastructure development. The RBI board has given emphasis on the overall framework that needs to be consistent with legal requirements and must exhibit fiscal prudence and consistency with global best practices.
Source: The Economic Times