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RBI harmonises definition of infrastructure lending for NBFCs

Last Updated: Friday, December 28, 2012 - 20:50

Mumbai: The Reserve Bank on Friday harmonised the definition of infrastructure lending for financing by non bank finance companies (NBFCs).

"It has been decided to harmonise the definition of infrastructure lending for NBFCs with that of banks," RBI said in a notification.

RBI had issued similar notification for banks last month.

The new harmonised definition has been aligned with the master list of Infrastructure sub-sectors' notified by the Government on March 27, 2012.

"The exposure of NBFCs to projects under sub-sectors which were included under our previous definition of infrastructure, but not included under the revised definition, will continue to get the benefits under 'infrastructure lending' for such exposures till the completion of the projects," it said.

However, it said, any fresh lending to those sub-sectors from the date of this circular will not qualify as infrastructure lending.

With 'infrastructure status' companies can avail loans for a longer period at lower rate of interest.

Giving a boost to key segments like roads and bridges, LNG and oil pipelines, water treatment plans, telecom towers, and three-star hotels, RBI gave them 'infrastructure status' and paved way for them to avail easier funding from banks.

In a notification, RBI had said the credit facility extended by lenders (banks and select financial institutions) to a borrower in about 30 odd sub-segment of the infrastructure sector will qualify as "infrastructure lending".

In the transport category, roads and bridges, ports, inland waterways, airport, railway track, tunnels, viaducts, bridges, urban public transport will qualify for infrastructure lending.

In the energy segment, generation, transmission, distribution, oil pipelines, oil/gas/liquefied natural gas storage facility and gas pipelines would qualify.

Likewise, solid waste management, water supply pipelines, water treatment plants, sewage collection, treatment and disposal system, irrigation (dams, channels, embankments), storm water drainage system projects come under infrastructure lending.

PTI

First Published: Friday, December 28, 2012 - 20:50
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