State-owned power sector finance company REC Ltd on Saturday said that the government is considering a proposal to accord the firm the status of a development financial institution.

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REC Limited, under the ministry of power, is being considered for the status of a Development Financial Institution (DFI) by the government of India, a company statement said.

The objective behind the move is to enable REC to steer global climate funding and net zero investment in the country, it explained.

In the annual general meeting of the corporation held on September 16, the investors were apprised by the chairman and managing director Vivek Kumar Dewangan about the company's plans to diversify into energy transition and future technology funding, it stated.

The estimated fund requirements for transitioning towards a net-zero economy would be around USD 3.5 trillion till FY50 and around USD 10 trillion till 2070, out of which a large share of investment will be required in the power sector, it explained.

REC as a DFI will analyse end-to-end capital flow requirements and bridge the gap by large-scale fund mobilisation and monitoring the funds, it stated.

With a strong domain expertise and appraisal capabilities, REC is strategically placed to dispense off the duties and responsibilities of a DFI, it pointed out.

Established in 1969, REC Limited is an NBFC focusing on power sector financing and development across India.

It provides financial assistance to state electricity boards, state governments, central/state power utilities, independent power producers, rural electric cooperatives and private sector utilities.