Government has proposed to set up a development financial institution (DFI).
DFI is expected to solve the infrastructure financing needs of the country as banks do not have the long-term funds to finance such projects.DFI’s will also help in reviving the economic growth of the country.
Development financial institution(DFI) are specialized institutions set up primarily to provide development Project finance especially in developing countries.
DFIs were started by the government of India to give sector-specific loans to various sectors namely to industry, agriculture, housing, infrastructure, export finance among others.
The first DFI was the Industrial Financial Corporation of India(IFC) that was setup in 1948.The IDBI,NABARD, EXIM Bank, SIDBI, NHB are the other major DFIs.Later several of them were converted into banks.