Shift away from bank-dominated financial system: Economic Survey
PTI: New Delhi, Feb 27 2013, 22:21 IST
issue that needs to be looked into in the context of the limitation of banks to finance such projects.
Though banks are main source of funding these projects, they have limitations because of asset-liability mismatch.
"Infrastructure development funds (IDF) through innovative means of credit enhancement are expected to provide long-term low-cost debt for infrastructure projects by tapping into savings like insurance and pension funds which have played a comparatively limited role in financing infrastructure."
By refinancing bank loans of existing projects, IDFs are also expected to take over a fairly large volume of the existing bank debt that will release an equivalent volume for fresh lending to infrastructure projects.
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