Answer:

In 2005, the Government of India constituted a 'National Investment Fund' (NIF) into which the realization from sale of shareholding of the Government in Central Public Sector Enterprises (CPSEs) would be channelized. In other words, realizations from disinvestments were to be maintained in NIF (which was kept outside of the Consolidated Fund of India).

Salient features:

♤ 75% of the annual income of the Fund was to be used to finance selected social sector schemes, which promote education, health and employment. The residual 25% of the annual income of the Fund was used to meet the capital investment requirements of profitable and revivable CPSEs that yield adequate returns, in order to enlarge their capital base to finance expansion/ diversification

♤ The Fund was professionally managed by three public sector mutual funds – SBI, LIC and UTI mutual funds to provide sustainable returns to the Government, without depleting the corpus.

♤ In 2009 the government had decided to put a ‘pause’ on putting disinvestment

money in NIF.