LIC, the country's leading insurance company, has said that it will not let the infrastructure NBFC company fail. And shall consider any of the step, including increasing stake in beleagured IL&FS to rescue it.
Recently, the lender who is engaged in some of the major onfrastructure development projects defaulted on a number of debt obligations and on Monday as per the PTI reports, defaultedd on commercial paper. The company said it will not be able to access the CP for a temure of 6 months from the repayment date obligation.
The number of downgrades are seen as a big negative and the govt.as a whole do not want the company to collapse.
The ministry is considering all such steps such as to bring down CRR or cash reserve ratio that is kept with the central banker.This is being considered to improve liquidity in the system.
Also, there are being considered ways such as opening a special window to infuse liquidity for mutual funds as well as buying in more bonds from OMOs.