In a move to give greater financial viability to the Irrigation and Water Resources Finance Corporation limited (IWRFC) which had been set up by the Government in 2008 with an initial paid up capital of Rs 100 crore, the Finance Ministry plans to make it a 100 per cent subsidiary of India Infrastructure Finance Company (IIFCl).
According to sources privy to the development, the Finance Ministry has sent a proposal in this regard for Cabinet’s approval and it may be taken up during today’s (December 5) meeting of the Union Cabinet. They added that in 2008 when IWRFC had been set up by the Government, the paid up capital of Rs 100 crore (contributed by the Centre) was very less and there was all round skepticism about its viability, considering the fact that it was formed to give long term financial assistance to water and irrigation projects mainly in rural areas which have huge potential, whereas the amount contributed by the Centre was too paltry to address its core aim.
In order to address this handicap, the Finance Ministry decided to bring it under the aegis of IIFCl, a special purpose vehicle (SPV) which itself was set up to provide long term finance to viable infrastructure projects. Official sources said that since IIFCl itself is meant for financing big ticket infrastructure projects, making IWRFC its 100 per cent subsidiary would help it access greater funds and enable it to bid for bigger irrigation projects.
At the same time, it would be able to bag bigger projects on the basis of the fact that IWRFC would now have the backing of IIFCl. In all likelihood, sources said, the proposal may be cleared by the Cabinet in its scheduled meeting on December 5. IWRFC has on its board officials from Finance Ministry as well as from the Ministry of Water Resources. The core areas on which IWRFC focuses while providing financial assistance to irrigation and water projects is micro-irrigation and contract farming as well as investment in water companies.
Sources further told The Pioneer that the Cabinet on Thursday may also consider the Ministry of Telecom and Information & Technology’s (I&T) proposal of seeking a clearance for its revised policy aimed at providing preference to domestically manufactured electronic goods. The policy is a part of the Telecom Ministry’s National Telecom Policy 2012, and has been framed to create a road-map to align technology, demand, standards and regulations for enhancing competitiveness of domestic manufacturing. The proposed cadre restructuring of the officials of Central Board of Excise and Customs (CBEC) is also likely to be considered by the Cabinet, sources added.