(MENAFN- KNN India) Thiruvananthapuram, Nov 7 (KNN) The World Bank on Monday recommended the cash-strapped Kerala Government to issue a 'Diaspora Bond' to tackle the financial crisis, reported Mathrubhumi News.
Dilip Ratha, a Lead Economist and Economic Adviser at the World Bank, has proposed the bond as a way to secure the investments of millions of Malayalis living abroad.
After speaking with state government representatives, Ratha also offered help of the World Bank to roll out the 'Diaspora Bond' scheme.
The Diaspora Bond has been used by several countries, notably Israel, Sri Lanka, Kenya, Greece and Egypt.
Meanwhile, the experts of the State Planning Board are of the opinion that the bond, which has been successfully used by the central government three times in the past, is also viable in the case of Kerala.
As per the reports, talks will be held at the chief secretary level soon. Following approval from the government, the commission will prepare the blueprint for the Diaspora Bond.
“The investment from Non-Indian Residents was Rs 2,36,000 crore in the previous year. As of June this year, the Malayali diaspora has contributed Rs 2,47,000 crore so far to the state. By issuing bonds with attractive interest rates, the government will be able to mobilize resources effectively,” said Planning Board member Dr. Ravi Raman to Mathrubhumi.
However, the government fears that 'Diaspora Bond' will be included in its borrowing limit as no other state has done such a resource mobilization. The matter would only become more evident during the implementation phase because it requires approval from the Reserve Bank of India (RBI).
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