Department of Economic Affairs will now handle financial policy work on investment fund

The work relating to formulation of financial policy on utilisation of proceeds of disinvestment channelised into the National Investment Fund (NIF) has been taken away from Department of Investment and Public Asset Management or DIPAM and given to Department of Economic Affairs. The Cabinet Secretariat has amended the rules recently in this regard.

The DIPAM, under the Finance Ministry, is responsible for advising the government in matters of financial restructuring of the Central Public Sector Enterprises and for attracting investment in them through capital market. It also looks after all matters relating to management of central government investments in equity including disinvestment of equity in Central Public Sector Undertakings.

The Union Cabinet had in November 2005 okayed creation of the NIF for channelising the proceeds from disinvestment of Central Public Sector Enterprises. "The income from the NIF is to be used for financing specific schemes for investment in social sector projects which promote education, health and employment and for capital investment in selected profitable and revivable Central Public Sector Enterprises (CPSEs) that yield adequate returns, in order to enlarge their capital base to finance expansion/ diversification," it had said then.