Phase IFoundation
Background
Overview
This policy instrument promotes ease of doing business, reduces financial stress on industries (like coal mining), encourages capital deployment, and diversifies financial instruments available in the economy, aligning with broader economic reforms and infrastructure development goals.
Performance guarantees are contractual assurances that an entity will fulfill its obligations, with a financial instrument backing the commitment. Insurance Surety Bonds (ISBs) are a type of performance guarantee where an insurer provides a financial guarantee to the beneficiary on behalf of the principal, ensuring compensation if the principal defaults on contractual terms.