Industrial Reconstruction Bank of India

Industrial Reconstruction Bank of India

The Government of India set up the Industrial Re-
construction Corporation of India (IRCI) in April 1971 under the Indian Companies Act mainly to look after the special problems of “sick’ units and provide assistance for their speedy reconstruction and rehabilitation. In August 1984,
the Government of India passed an Act converting the Industrial Reconstruction Corporation of India (IRCI) into the Industrial Rec9Rstruction Bank of India (IRBI). The IRBI
has to function as the principal all-India credit and reconstruction agency for industrial revival, assisting and promoting industrial development and rehabilitating industrial concerns.

During 1994-95, the IRBI had sanctioned Rs. 778 crore mainly in the form of term-loans, for modernisation, diversification, expansion, renovation. Its disbursements went upto
Rs. 398 crore. Formerly IRCI had extended assistance to sick closed industrial units in textiles, engineering, mining and foundary industries. Now IRBI extends assistance to sick
small-scale units also.

The IRBI had diversified its activities into ancillary
lines such as consultancy services, merchant banking and equipment leasing. All these activities are allied to its task of rehabilitation of sick industrial units. Through its consultancy services, IRBI attempts to help banks and financial institutions to assess intrinsic worth of sick units which are seeking assistance for revival. Through its merchant banking services, IRBI enables units in the process of amalgama-
tion, merger and reconstruction. Equipment leasing was, in fact, an extension of the IRBI hire-purchase scheme.

Leave a Comment