FinMin may soon set up DFI as banks struggle to finance infra projects

Govt has already come out with an pipeline of 6,749 projects which would cost $1.7 trillion in five years

The finance ministry is likely to soon set up a development financial institution (DFI) to take up infrastructure projects, as banks are already running into bad debt problems and their asset-liability has a mismatch for the long gestation these projects involve. 

Finance minister Niramala Sitharaman recently said that work on setting up a DFI was on. The issue being deliberated on is whether it will be a private entity or a government entity. 

“What shape it will take we will know shortly,” the finance minister had said. 

The proposed move assumes importance in the wake of RBI governor Shaktikanta Das saying that industry