New Delhi, Jul 30 (IANS): The union cabinet on Wednesday gave its approval to create a Rs.20,000 crore National Investment and Infrastructure Fund (NIIF) to give boost to infrastructure projects, including those which are stalled, sources said.

The cabinet also gave its approval to foreign investment in the Alternative Investment Funds (AIFs) for facilitating domestic investment, they said.

The NIIF is being established to maximise economic impact through infrastructure development in commercially viable projects, both green field and brown field including stalled projects, the sources said.

Its initial authorised capital would be Rs.20,000 crore, which will be raised from time as decided by the finance ministry.

Finance Minister Arun Jaitley had proposed creation of infrastructure fund in his budget 2015-16.

The sources said that the government would contribute 49 percent of the subscribed capital of NIIF, adding the contribution of the government to NIIF would attract investment from overseas sovereign/quasi-sovereign/multilateral/bilateral investors.

Approval to foreign investment in the AIFs for facilitating domestic investment was follow up of announcement made in the this year's budget, they said, adding the decision will lead to availability of more funds to start-ups, early stage venture, social venture, small and medium enterprises, infrastructure and sectors considered as socially desirable but regarded as having uncertain returns.