Context:

India’s cabinet approved the establishment of a development financial institution (DFI) with a fund worth 200 billion rupees ($2.8 billion) to boost investment in infrastructure projects.

About the Development Finance Institution (DFI)

The Development Finance Institution (DFI) are organizations that are either owned by the government or by charitable institutions to finance infrastructure projects that are of national importance but may or may not meet commercial return standards.

Types of Finances by DFIs:

• Medium(1-5 years)
• Long term(>5 years)

DFIs Categories:

• National Development Banks such as IDBI, SIDBI, ICICI, IFCI, IRBI, and IDFC.
• Sector-specific financial institutions such as TFCI, EXIM Bank, NABARD, HDFC, and NHB.
• Investment Institutions such as LIC, GIC, and UTI.
• State-level institutions such as State Finance Corporations and SIDCs.