Mumbai, Feb. 3: Finance minister Jaswant Singh’s announcement that Industrial Development Bank of India (IDBI) will be the lead institution to appraise and fund developmental projects has sparked speculations.

“Was that a hint to say that it is also the lead financier in infrastructure projects overriding Infrastructure Development Finance Corporation (IDFC)?” National Committee on Urban Infrastructure chairman Vinayak Chatterjee said.

Analysts are also conjecturing on IDBI’s plans to convert itself into a universal bank.

“The finance minister would not say something just like that,” Chatterjee said. “There’s a hidden message there,” he added.

Former finance minister P. Chidambaram had created IDFC in his budget under the Devegowda government. Headquartered in Chennai, IDFC was envisaged as the lead development institution to appraise and fund infrastructure projects. The question now arises as to whether it will play second fiddle to IDBI in infrastructure projects along with SBI.

The government has decided to designate IDBI as the lead developmental finance institution in view of its expertise, experience in project appraisal, funding and coordination.

Steps to revive and re-structure IDBI are on the cards, Singh said. It was expected to help in making timely finance available at reasonable rates, he added.

IDBI's efforts would be complemented by others like IDFC and SBI.