RIDF corpus to increase to Rs 12,000 crore

New Delhi, Feb 28 (UNI) Finance Minister P Chidamabaram today said he would increase the corpus for Rural Infrastructure Development Fund (RIDF) for 2007-08 to Rs 12,000 crore and urged states to use these funds primarily in their distressed districts.

In his Budget Speech for 2007-08, the Finance Minister said the RIDF continues to sanction and disburse funds to state governments and in 2006-07, out of a corpus of Rs 10,000 crore, NABARD has so far issued sanctions for Rs 8,440 crore and will achieve its target.

He said a separate window for rural roads under RIDF was opened with Rs 4,000 crore. Against this, projects for Rs 2,311 crore have been sanctioned in 2006-07 and he proposes to continue a seprate window under RIDF in 2007-08 with a corpus of Rs 4,000 crore.

''I propose NABARD which provides refinance to financial instituions to issue rural bonds to the extent of Rs 5,000 crore.

These bonds will be guaranteed by the government and will be eligible for suitable tax exemption,'' the Minister said.

UNI