India plans to set up a National Education Finance Corporation (NEFC) to provide loans for educational infrastructure expansion and re-finance study loans to needy students who otherwise fail to pursue higher education.

"A proposal for the establishment of National Education Finance Corporation is under consideration, which aims at providing loans for infrastructure development and expansion of educational institutions, as well as re-finance facility for educational students loans," Human Resource Development Minister Kapil Sibal said in the Rajya Sabha.

Once it is established, thousands of students who fail to avail of study loans to pursue higher education will benefit. The HRD ministry is in touch with the Planning Commission over the issue, Sibal said.