The Centre, on Saturday, launched the national investment fund (NIF) which aims to use the returns from investment of disinvestment proceeds to fund social sector projects and partly to meet capital investments in profitable public sector units.
The fund was launched by Finance Minister P Chidambaram with handing over of Rs 994.82 crore received from sale of government equity in Power Grid Corporation of India Ltd to three Fund Managers.
Revival of PSUs
The fund will use 75 per cent of its annual income to finance selected social sector schemes to promote education, health and employment. The residual 25 per cent of annual income will be used to meet capital investment requirements of profitable and revivable CPSEs. The three fund managers chosen for NIF are UTI Asset Management Company Pvt Ltd, SBI Funds Management Pvt Ltd and LIC Mutual Fund Asset Management Company Ltd. NIF will be maintained outside the Consolidated Fund of India and professionally managed to provide sustainable returns to the government, without depleting the corpus. Sebi guidelines will apply to the operation of the fund by selected fund managers under the discretionary mode of the Portfolio Management Scheme, and the three managers have been appointed for an initial period of two years, extendable on the basis of their performance subsequently.
