Indian govt to invest $812 million in NIIF

Javadekar also said that the AIFL will predominantly focus on under construction, greenfield, brownfield assets with less than one year of operations whereas NIIF IFL will operate as a take-out vehicle for mature operating assets. It is expected that well-capitalized, well-funded and well-governed NIIF debt Platform can play a major role in infrastructure financing and development of Bond Market in India by acting as a AAA/AA-rated intermediary between the bond markets and infrastructure projects and companies.

 

NEW DELHI:

The Indian cabinet on Wednesday approved a capital infusion of 60 billion rupees ($812 million) by the government in the National Investment and Infrastructure Fund (NIIF), a quasi sovereign wealth fund, over the next two years, a minister said.

The government would invest 24 billion rupees in the NIIF during the current financial year ending in March that would help it raise up to 1.1 trillion rupees for investments, Prakash Javadekar, minister of information and broadcasting told reporters after the cabinet meeting.

The equity infusion will be sponsored by Aseem Infrastructure Finance Limited (AIFL) and NIIF Infrastructure Finance Limited (NIIF-IFL).

Javadekar said, "Of the Rs 100 lakh crore been earmarked for infrastructure, nearly Rs 70 lakh crore is expected to come from the bond market and debt funds. Today's decision is start. The government will provide Rs 6,000 crore; the National Investment Infrastructure Fund (NIIF) will provide Rs 7,000 crore equity and nearly Rs 1 lakh crore will be raised from the bond market."

The government will invest Rs. 6000 crore as equity and the rest will be raised through the private investors.

To support the funding of the National Infrastructure Pipeline announced by the Finance Minister earlier last year, the equity infusion comes as an additional support, Javadekar informed.

Javadekar also said that the AIFL will predominantly focus on under construction, greenfield, brownfield assets with less than one year of operations whereas NIIF IFL will operate as a take-out vehicle for mature operating assets.

It is expected that well-capitalized, well-funded and well-governed NIIF debt Platform can play a major role in infrastructure financing and development of Bond Market in India by acting as a AAA/AA-rated intermediary between the bond markets and infrastructure projects and companies.

"The decision will take care of the financial needs of planned infrastructure projects. It shows the world that they can believe in India's development and that they can be a part of it," said Javadekar.


 


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