The Centre on Tuesday said it would preserve Industrial Development Bank of India's development financing role and provide the "necessary" support for making it a lead institution with backing from entities including State Bank of India and Infrastructure Development Finance Corporation.
Presenting the Interim Budget for 2004-05, Finance Minister Jaswant Singh said the government has decided to designate IDBI as the leading developmental finance institution in view of its expertise, experience in project appraisal, funding and coordination.
"It was expected to help in making available timely finance at reasonable rates," Singh said, adding IDBI's efforts would be complemented by other premier institutions and banks such as IDFC and State Bank of India.
"The government will also provide the requisite support to IDBI for the task," he said, stressing there was no alternative to development finance.
He said the current economic growth pattern required continuous and added investment.
The finance minister also said IFCI would be restructured by transferring its impaired assets to an Asset Reconstruction Company and merger with a large public sector bank.
Singh said both the institutions -- IDBI and IFCI -- should be functional in the new financial year after their transformation.
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