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Russia to create new bank to channel $35 bln into economy

Russia's government agreed to create a new bank to channel $35 bln into transportation infrastructure, power generation, housing and other sectors through 2011, an adviser to President Vladimir Putin said.

The national development bank will probably be created by the end of the year and oversee the state Investment Fund, Arkady Dvorkovich, Putin's senior economic adviser, said today. The Investment Fund will hold a total of 377.9 billion rubles ($14.4 billion) of budget money in 2009 and the plan is for the new bank to invest $35 billion in the domestic economy by 2011, Dvorkovich said on the sidelines of a business conference in Krasnoyarsk, Siberia. The lower house of parliament, the State Duma, gave preliminary approval to a bill creating the bank this week. Lawmakers want the bank to attract 3 rubles from the private sector for every ruble the government contributes to the bank, Vedomosti newspaper reported yesterday, citing Vladimir Dmitriev, chairman of state-run lender Vnesheconombank. (Bloomberg)