State Financial Corporations-Overview
Introduction
A Central Industrial Finance corporation was set up under the industrial Finance corporations Act, 1948 in order to provide medium and long term credit to industrial undertakings which fall outside normal activities of commercial banks.
The State governments expressed their desire that similar corporations be set up in states to supplement the work of the Industrial financial corporation. State governments also expressed that the State corporations be established under a special statue in order to make it possible to incorporate in the constitutions necessary provisions in regard to majority control by the government, guaranteed by the State government in regard to the payment principal.
In order to implement the views Expressed by the State governments the State Financial
Corporation bill was introduced in the Parliament.
Statement of objects and reasons
In order to provide medium and long term credit to industrial undertaking, which fall outside the normal activities of commercial banks, a central industrial finance corporation was set up under the industrial Finance Corporations act, 1948.
The state governments wished that similar corporations should be set up in their states to supplement the work of industrial financial corporation.
The intention is that the State corporations will confine to financing medium and small scale industrial and will , as far as possible consider only such access which are outside the perview of industrial fiancé corporation .
The main features of the State financial Corporations Act 1951:
i.
The bill provides that the state government may, by notification in the official gazette, establish a financial corporation for the state. ii. The share capital shall be fixed by the State government but shall not exceed Rs 2 crores . The issue of the shares to the public will be limited to 25 % of the share capital and the rest will be held by the State Governments, The Reserve Bank,
Scheduled
A Central Industrial Finance corporation was set up under the industrial Finance corporations Act, 1948 in order to provide medium and long term credit to industrial undertakings which fall outside normal activities of commercial banks.
The State governments expressed their desire that similar corporations be set up in states to supplement the work of the Industrial financial corporation. State governments also expressed that the State corporations be established under a special statue in order to make it possible to incorporate in the constitutions necessary provisions in regard to majority control by the government, guaranteed by the State government in regard to the payment principal.
In order to implement the views Expressed by the State governments the State Financial
Corporation bill was introduced in the Parliament.
Statement of objects and reasons
In order to provide medium and long term credit to industrial undertaking, which fall outside the normal activities of commercial banks, a central industrial finance corporation was set up under the industrial Finance Corporations act, 1948.
The state governments wished that similar corporations should be set up in their states to supplement the work of industrial financial corporation.
The intention is that the State corporations will confine to financing medium and small scale industrial and will , as far as possible consider only such access which are outside the perview of industrial fiancé corporation .
The main features of the State financial Corporations Act 1951:
i.
The bill provides that the state government may, by notification in the official gazette, establish a financial corporation for the state. ii. The share capital shall be fixed by the State government but shall not exceed Rs 2 crores . The issue of the shares to the public will be limited to 25 % of the share capital and the rest will be held by the State Governments, The Reserve Bank,
Scheduled