America's DFC to invest $350 million in India

Development Finance Corporation (DFC) -It's an independent agency In USA . which provide finance to the private development projects . DFC has created a BUILD model which is "better utilization of investment leading to development".

Recently DFC has decided to invest $350 million in India. These $350 million is not provided to central government ,which means no tax payers money well be use to pay interest (Finance cost) or face value, Indian firms and various banks are going to receive this type of loans at very low finance cost. Most of these loans were part of $1 billion flag ship program of DFC ,objective of these loans is to provide low cost interest to fast track the development in various part of the world like Africa, Latin America and other emerging markets.

Main Crux - formation of DFC is to act as an alternative for Chinese low cost funds. DFC will finance to private sector companies and private sector banks, they mainly finance those projects which are financially viable and sustainable. The contracts of DFC is highly transparent. DFC is trying to sidestep opaque financing that often results in unsustainable debt. Interest rate are link with yield on marketable treasury securities.

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