FM Chidambaram pins hopes on infrastructure debt funds to lower tariffs
“The cost and tariff of infrastructure services are likely to go down as a result of low cost long term debt provided by IDFs,” Chidambaram said at the launch of operations of the $2 billion India Infra Debt Limited (Infradebt), which is the country’s first IDF set up through the non-banking finance company (NBFC) route.
Infra debt is expected to invest in core sector projects under the public-private partnership model that have completed at least one year of operations. “This is the first IDF in the form of NBFC and will commence operations very soon. The capital of Rs 300 crore has been contributed,” said Chanda Kochhar, MD and CEO of ICICI Bank which is one of the promoters of the fund. ICICI Bank holds 31 per cent stake in the fund followed by Bank of Baroda at 30 per cent, Citibank at 29 per cent and LIC at 10 per cent.
The four firms had signed a memorandum of understanding for the IDF nearly a year ago. “There are large pools of global and domestic capital looking for attractive investment prospects. India Infradebt is a unique platform to match these funds and their appetite for long term and stable investments with the compelling India infrastructure opportunity,” said Pramit Jhaveri, CEO of Citi India.
Be the first to comment.