History

The State Cabinet of Government of Karnataka in its decision of 7th November 1998 accorded “in principle” approval for the setting up of Karnataka Infrastructure Development & Finance Corporation (KIDFC). Subsequently, in consultation with leading financial institutions such as ICICI, IDBI, IDFC and banks it was decided that KIDFC is to provide financial and non-fund based services to both public sector and private infrastructure projects and help in achieving financial closure.

A reputed consultant firm prepared the company’s first business plan which proposed that KIDFC should be a self-sustaining, nodal agency for facilitating private sector investment in infrastructure areas. It would be privately managed and primarily have two sets of operations, one in the commercial side and other on the development side. On the commercial side, KIDFC would take up only those projects, which are viable and where return on investment is assured. The other arm of KIDFC would be project development, managed by a fund, which would identify projects, carry out feasibility studies, assist government in policy formulation and play a key role in rationalising legal and regulatory frameworks to encourage private sector partnership in infrastructure development.

The State Cabinet in its meeting on 28.6.1999, decided that KIDFC is to be the nodal state agency with the mandate of promoting private sector investment in infrastructure areas, Government should hold not less than 26% and not more 49% of equity, the entity should be incorporated as a private company under the Companies Act, infrastructure cess to be transferred to iDeCK as equity or subordinate debt or in such other form as is necessary and to avoid confusion in similar sounding names, it was decided that KIDFC should be known as Infrastructure Development Corporation (Karnataka) Limited (iDeCK).

In the State budget speech of 2000-01, Hon’ble Chief Minister said that Government and Infrastructure Development Finance Company Ltd (IDFC) will form iDeCK in the private sector and the Government will contribute Rs. 200 crores out of the Infrastructure Initiative Fund from the levies received by the collection of infrastructure cess (5%) on Karnataka Sales Tax Act, Excise Tax Act, Stamps Act and Motor Vehicles Taxes Act.

The Government, vide its order No. 1828 Exp.I 98 dated 3.5.2000 approved setting up of iDeCK with IDFC as its majority partner. The Company was incorporated under the Companies Act on 30th June 2000. The initial authorised capital of the Company is Rs. 50 crores with an initial paid up capital of Rs. 70 and GoK, IDFC and HDFC agreed to contribute further sums towards increasing the aggregate paid up capital to Rs. 10 crores in the ratio of 49%, 49.5% and 1.5% respectively.

The first Chairman of the Company was Mr.B.K.Das, IAS, Government of Karnataka and Mr. Cherian Thomas, a nominee of IDFC was its first Managing Director.