Terming India “a sweet spot where the rule of law prevails”, Finance Minister Piyush Goyal said here on Monday the country wants investments in nine projects from the China-based Asian Infrastructure Investment Bank (AIIB).
Speaking to the media, Goyal said India has already picked up almost 28 per cent – or $1.4 billion – AIIB’s total lendings, for seven projects in the country.
The focus of AIIB’s lending has been on rural infrastructure, energy and power, environmental protection, transportation and telecommunication, water supply and sanitation, besides urban developments and logistics.
Goyal said “it’s a matter of great pride that India is the largest recipient of the $4.2 billion funds disbursed by AIIB.”
He attributed a robust framework and easy to navigate policies being the key reasons for the investment flow into the country’s infrastructure sector.
The minister mentioned how Mumbai has improved its ranking in the Swachhta Index significantly during the past few years and is engaging with international global efforts for a better quality of life.
He assured that by 2022, as part of the Prime Minister’s plan, the government will ensure every citizen has a shelter over his head, round-the-clock electricity, good toilets, clean drinking water, access by road to his house and internet connectivity.
Earlier, welcoming delegates from 86-AIIB member countries, Goyal said that in just three years, India has hosted three major international multilateral banks – the New Development Bank, the African Development Bank and now the AIIB.
He lauded AIIB’s robust processes and said how the concept was floated in 2014, matured in barely seven months and the Multilateral Development Bank was in place by 2016, with India as the second largest stakeholder with eight percent.
Later this afternoon, AIIB announced an equity investment of $100 million in India’s National Investment & Infrastructure Fund (NIIF) to help various development projects in this country.
The amount will be for the Phase I of NIIF’s Fund of Fund (Eds: Correct) initial closing and the AIIB is considering another $100 million in Phase II for the final closing, bringing the bank’s total commitment to $200 million.
The NIIF is a collaborative investment platform for international and domestic investors keen on investing in commercially viable Indian infrastructure projects.
The NIIF’s Fund of Fund will anchor or invest in funds managed by fund managers with good track record in various infrastructure and associated sectors in India.
Some of the focus sectors include: Green Infrastructure, Mid-Income and Affordable Housing, Infrastructure Services and Allied Sectors, the AIIB said.
The NIIF Fund of Funds recently announced its first investment – Green Growth Equity Fund – which will invest in renewable energies, clean transportation, water, sanitation and waste management.
The AIIB will provide its expertise to enhance NIIF’s environmental and social risk management capabilities to improve and monitor ecological and social performance across the portfolio investments.
“Our investment in the NIIF reflects AIIB’s commitment to support the Government of India in its efforts to promote investment in infrastructure and to mobilize private capital for development,” said AIIB Vice-President and Chief Investment Officer D.J. Pandian.
The AIIB Director-General of Investment Operations, Dong-Ik Lee, said the NIIF will provide access to a diversified range of sub-funds and trigger a multiplier effect in attracting capital.
“With AIIB’s investment in the NIIF, we will help pool commitments from long-term investors such as multilateral institutions, sovereign wealth funds, pension funds and insurance companiesa”within and outside Indiaa”to make investments in the country’s infrastructure sector,” Lee said.
With a total project portfolio of $4.4 billion, India is the largest borrower from the AIIB since it started its operations two-and-a-half-years ago.
The 3rd AIIB annual meeting was opened in Mumbai on Monday with a focus on infrastructure, coupled with the theme of innovation and collaboration.