The government today launched the National Investment Fund (NIF), which would
channelise proceeds from government divestment in all public sector undertakings.
NIF was launched at a function presided over by finance minister P Chidambaram
in New Delhi today.
finance minister also handed over a total amount of Rs994.82 crore received from
the sale of government equity in Power Grid Corporation of India to three fund
managers - UTI Asset Management Company (Rs368.91 crore), SBI Funds Management
(Rs368.91 crore) and LIC Mutual Fund Asset Management (Rs257.00 crore).
will utilise 75 per cent of its annual income to finance select social sector
schemes that promote education, health and employment. The remaining 25 per cent
will be used to meet the capital investment requirements of profitable and revivable
central public sector enterprises.
will be operated by the fund managers under discretionary mode of the portfolio
management scheme, which is governed by Sebi guidelines.
Asset Management Company Pvt. Ltd., SBI Funds Management Pvt. Ltd. and LIC Mutual
Fund Asset Management Company Ltd will act as fund managers for NIF, initially
for a period of two years, which would subsequently be extended on the basis of
will be maintained outside the Consolidated Fund of India and will be professionally
managed to provide sustainable returns to the government, without depleting the
AMCs signed separate agreements for portfolio service management and fund management
with the joint secretary, divestment department of the finance ministry.
finance ministry also announced the setting up of a part time advisory board to
advise the CEO, NIF on various aspects of functioning of the NIF, viz., investment
strategy, allocation of funds to the selected fund managers, negotiation of management
fee and charges to be paid to the fund managers.
advisory board has former chairman of LIC SB Mathur, former chairman of Oriental
Bank of Commerce BD Narang, RPG Foundation president, and chairman of International
Life Science Institute, India D H Pai Panandiker as members.
also see : General
reports on Economy