New Delhi, July 07: The Government will restructure
the National Investment Fund (NIF), where money received from
disinvestment is parked, according to sources.
"That (NIF) architecture needs to be either partially or
fully demolished," the sources said.
NIF was set up to assuage the feelings of allies in the
previous UPA regime, who were opposed to disinvestment. It was
set up in 2005 so that proceeds from disinvestment does not go
to the Government kitty but to a separate entity.
Only returns earned through the funds parked in NIF could
be used and not the corpus itself.
The sources said the need for restructuring arose not so
much to channelise the proceeds from disinvestment to the
government kitty, but to see that the corpus is used and not
just returns on investment from the fund.
In the current scheme of things, 75 per cent of the annual
income from investment of NIF are used to finance selected
social sector programmes, while the remaining is deployed to
meet the capital investment requirements of profitable and
revivable public sector units.
Three mutual funds, UTI MF, SBI MF and Jeevan Bima Sahyog
are the fund managers of NIF. The fund has so far received Rs.
994.82 crore from the sale of government equity in the Power
Grid.
The Government has announced its intent to divest its
holding in public sector units in favour of the people,
without diluting its stake below 51 per cent.
Bureau Report
