Speaking at the inauguration of Rabo India's Mumbai office, Smits said that joint ventures would be an effective way of bringing local expertise together with global technology.

"There are strong indications that before entering into specific financial structures, Rabo will have to do a lot of advising as well. We will make this available here as well, especially focussed on new joint ventures, but not necessarily limited to them," Smits said.

Rabo India is the first instance of an overseas entity setting up a venture here to cater specifically to the food, agri and healthcare businesses. The new venture also sees a 25 per cent local equity participation by three senior bankers: Former Deustche Bank and ABN Amro Bankcountry-heads, Harikirat Singh and Ashok Kapur, as also Bank of America's former head of wholesale banking and until recently, general manager at ANZ Investment Bank, Rana Kapoor. Rabobank is represented on the board of Rabo India by Anton Nillesen and Hans Hannaart.

The prime focus of Rabo India will be on food processing. "Till date, we have, to a great extent, looked at the procesing industry much like the manufacturing sector with collateralised advances. Rabo India will not look at the processing industry as an asset-based business, but more importantly, at the value chain -- right from the primary produce to the finished products -- and add value wherever possible," Rabo India special advisor to the managing board of Rabobank International Harkirat Singh said.

"Investments in the infrastructure and logistic systems are extremely necessary for the food-processing industry. On the pre-condition that these investments are integrated with the processing units, the bank is prepared to offer the financialsolutions," Smits said.

Rabo India has set up a dedicated agri-business project finance team specialising in evolving project finance structures in the food and agri-business sectors. Worldwide, Rabobank's largest project finance exposure is to the edible oils sector (20 per cent) followed by meat products, particularly poultry (18 per cent).

Rabobank has been evaluating the Indian market for the past two years in agro-based and health-care fields. These range from relatively mature industries like tea and coffee to beverages, cereals and poultry among others where there is termendous scope for commercial development.

While India has the largest area of land under agricultural cultivation, it accounts for just a little over one per cent of the global agricultural production.

Rabo India already has a loan book of Rs 100 crore and aims to have one of Rs 400 crore by end-1999. The capital base of Rabo India is a shade over Rs 100 crore. Local resources are to be raised via a combination of commercialpaper and bond issuances, committed lines of credit from banks and inter-corporate deposits. The Indian outfit is looking at raising resources in the region of Rs 400 crore during 1999.