First climate development financial institution runs into FinMin roadblock

Ministry ready to offer provisions to ease global climate funding

The plan to have the country’s first climate-development financial institution (DFI) has hit a regulatory hurdle with the Union Ministry of Finance turning down the proposal of power sector lenders PFC Ltd and REC Ltd to be designated as such.

The finance ministry, however, has told the two non-banking financial companies (NBFCs) various dispensations under the existing DFI regime can be made available to them for routing global climate funding.

Last year, in September, the Union power ministry had pitched the proposals of PFC (earlier Power Finance Corporation) and REC (earlier Rural Electrification Corporation) to get DFI status, this paper