Reports indicate that the Finance Ministry allowed sovereign wealth funds to invest in debt instruments floated by state-run companies. It may be noted that the government allowed 13 state-run firms to raise around Rs 48,000 crore by selling tax-free bonds in 2013-14. The fund would be used for infrastructure such as roads, ports and power plants.
Government allowed India Infrastructure Finance Co and Indian Railway Finance Corp to raise around Rs 10,000 crore through tax-free bonds in 2013-14. Similarly, Housing and Urban Development Corp, Rural Electrification Corp, Power Finance Corp and National Highways Authority of India were allowed to raise Rs 5,000 crore each.
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