Role of IDBI in Foreign Investment

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The role of IDBI in Foreign Investment is mainly to provide financial assistance on a consortium basis to various industrial units in India which are mainly involved in manufacturing or processing of goods, mining, transport generation and distribution of power.

An Overview of Industrial Development Bank of India (IDBI)-



Industrial Development Bank of India (IDBI) has been a fully owned subsidiary bank of the Reserve Bank of India till February 1976.

It was then disconnected from RBI and was made an autonomous corporation owned by the Government of India. IDBI is known to be the tenth largest bank in the world in terms of carrying out developmental activities. Some of the financial institutions set up by IDBI to carry out the activities are The National Stock Exchange (NSE), The National Securities Depository Services Ltd. (NSDL), and Stock Holding Corporation of India (SHCIL).

Main Functions of IDBI-



  • IDBI coordinates between various financial institutions who are highly involved in provide financial assistance, promoting, and developing various industrial units

  • IDBI is also engaged in a variety of promotional activities such as development programs for the fresh entrepreneurs, planning of consultancy services for both the small scale enterprises and the medium sized industrial units

  • IDBI works for the advancement of technology and other welfare schemes to ensure economic development.

  • Industrial Development Bank of India acts as a catalyst in various industrial development programs

  • IDBI provides financial assistance to all kinds of industrial units which comes under the provisions of the IDBI Act

  • IDBI has served various industrial sectors in India for about three years and has grown leaps and bounds in its size and operating units

Role of IDBI in Foreign Investment-



  • It manages various financial institutions working under IDBI bank
  • Provides financial assistance to various industrial units in terms of developments
  • It also offers refinancing options including term loans to the suitable financial institutions
  • It provides funding to the industrial units that are involved in manufacture or processing of goods, mining, transport generation and distribution of power both in private and public sectors
  • It also provides finance to various projects, expansion of any project, diversifications, or even developing the projects which will exceed ` 30 million and it also provides funding to those projects which cost less than ` 30 million through indirect means as it offers refinancing to the main financial institutions such as SFC/SIDC/Commercial Banks etc
Last Updated on 3/17/2011