Credit Guarantee Enhancement Corporation to be set up: FM

New Delhi: A Credit Guarantee Enhancement Corporation is to be set up in 2019-20. This was announced by the Union Minister of Finance and Corporate Affairs, Nirmala Sitharaman, while presenting the Union Budget 2019-20 in Parliament today.

The Finance Minister further said that we recognize that investment-driven growth requires access to low cost capital. It is estimated that India requires investments averaging Rs. 20 lakh crore every year (USD 300 billion a year).

The Finance Minister further added that a number of measures are proposed to enhance the sources of capital for infrastructure financing, which are as follows;

A Credit Guarantee Enhancement Corporation for which regulations have been notified by the RBI, will be set up in 2019-20.

An action plan to deepen the market for long term bonds including for deepening markets for corporate bond repos, credit default swaps etc., with specific focus on infrastructure sector, will be put in place.

To permit investments made by FIIs/FPIs in debt securities issued by IDF-NBFCs to be transferred/sold to any domestic investor within the specified lock-in period.