With reference to the National Investment Fund, to which disinvestment proceeds are routed, consider the following statements:
Which of the statement(s) given above is/are correct?
With reference to the National Investment Fund, to which disinvestment proceeds are routed, consider the following statements:
Which of the statement(s) given above is/are correct?
The correct option is C 3 and 4
NIF is professionally managed by selected Public Sector Mutual Funds. 75% of the annual income of the Fund is used to finance selected social sector schemes, which promote education, health and employment. The residual 25% of the annual income of the Fund is used to meet the capital investment requirements of profitable and revivable CPSEs that yield adequate returns, in order to enlarge their capital base to finance expansion/ diversification.
In January 2005, the Government decided to constitute a ‘National Investment Fund’ (NIF) into which the realization from sale of minority shareholding of the Government in profitable CPSEs would be channelized. The income from the fund is used in investment in various social projects, capital investment in some selected profitable and revivable enterprises. This is based upon the idea that disinvestment does not affect the social objectives of the government.
The money obtained from disinvestment is shown in India’s receipt budget as other non-tax revenue. Prior to the global economic crisis in 2008-09, 75 per cent of the corpus of NIF were utilised for social sector schemes and 25 per cent for revival for sick PSUs. However, since November 2009, the disinvestment proceeds are entirely routed to Consolidated Fund to be used for funding social sector schemes.
The corpus of the National Investment Fund is of permanent nature, this means that generally only income generated is used for social expenditures and investments and the corpus is kept permanent.
Schemes in which NIF income is invested:
- Mahatma Gandhi National Rural Employment Guarantee Scheme
- Indira Awas Yojana
- Rajiv Gandhi Gramin Vidyutikaran Yojana
- Jawaharlal Nehru National Urban Renewal Mission
- Accelerated Irrigation Benefits Programme
- Accelerated Power Development Reform Programme
3 and 4
NIF is professionally managed by selected Public Sector Mutual Funds. 75% of the annual income of the Fund is used to finance selected social sector schemes, which promote education, health and employment. The residual 25% of the annual income of the Fund is used to meet the capital investment requirements of profitable and revivable CPSEs that yield adequate returns, in order to enlarge their capital base to finance expansion/ diversification.
In January 2005, the Government decided to constitute a ‘National Investment Fund’ (NIF) into which the realization from sale of minority shareholding of the Government in profitable CPSEs would be channelized. The income from the fund is used in investment in various social projects, capital investment in some selected profitable and revivable enterprises. This is based upon the idea that disinvestment does not affect the social objectives of the government.
The money obtained from disinvestment is shown in India’s receipt budget as other non-tax revenue. Prior to the global economic crisis in 2008-09, 75 per cent of the corpus of NIF were utilised for social sector schemes and 25 per cent for revival for sick PSUs. However, since November 2009, the disinvestment proceeds are entirely routed to Consolidated Fund to be used for funding social sector schemes.
The corpus of the National Investment Fund is of permanent nature, this means that generally only income generated is used for social expenditures and investments and the corpus is kept permanent.
Schemes in which NIF income is invested:
- Mahatma Gandhi National Rural Employment Guarantee Scheme
- Indira Awas Yojana
- Rajiv Gandhi Gramin Vidyutikaran Yojana
- Jawaharlal Nehru National Urban Renewal Mission
- Accelerated Irrigation Benefits Programme
- Accelerated Power Development Reform Programme
