National Investment and Infrastructure Fund: UAE set to finalise $75 deal

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New Delhi | Published: January 4, 2017 6:18:21 AM

Major boost for Infra: UAE confirms that a joint working group is finalising procedural details of the $75 billion investment into NIIF.

Major boost for Infra: UAE confirms that a joint working group is finalising procedural details of the $75 billion investment into NIIF.

UAE funding to be pumped into Indian infrastructure India and the UAE signed a Memorandum of Understanding (MoU) in 2016 to explore opportunities for mobilisation of long-term investment through the National Investment and Infrastructure Fund (NIIF). The fund will support rapid expansion of next-generation infrastructure, especially in railways, ports, roads, airports, and industrial corridors and parks.

Overall ‘Stressed Advances’ of banking system worsens to a scary 12.3% as of Sept 2016. Infra PPP financing now even more difficult.

Infra sector continues to be a stress zone

According to RBI’s Financial Stability Report, risks to the banking sector remained elevated due to continuous deterioration in asset quality, low profitability and liquidity. Infrastructure, iron and steel, and engineering and power sectors are the ones that have been highly impacted.

Finally—a bit of good news for construction cos. NHAI starts releasing payments against Govt directive of 75% of arbitration awards won.

Payout time
Following CCEA’s directive, NHAI has started releasing payments. IRB is among the first to receive an amount of R270 crore. This is expected to somewhat ease the liquidity woes of construction companies.

Power trail: Apparently Discom collections s by a whopping R3000 crs post Demonetisation till Dec 15. Down to the wire, literally!

Discoms’ demonetisation bonanza
Between November 10 and December 15, 2016, discom collections increased by R3,000 crore compared to last year. Apparently, customers in certain states have energetically cleared arrears and even deposited advances.

Direct subsidy to targeted electricity consumers is a ‘powerful’ idea for Discom financials. Wish @PiyushGoyal very best for pushin it.

Empowering power consumers
An expert committee set up by the power ministry is exploring how electricity demand and consumption can be amped by subsidising target consumers. The idea is to use a strategy similar to the direct benefit transfer scheme for LPG cylinders, aimed at reducing the subsidy burden and plugging leakages.

Data frm diff sources point to t in hiway toll collection by 15-20% since resumption after demonetisation. Recovery trajectory uncertain.
Confidence Booster: NHAI to seek CCEA clearance for R922 crs compensation to PPP road operators for demon toll loss. Most appropriate.

Respite for road operators in sight
The National Highways Authority of India is making all out efforts to provide relief. It has worked out the compensation amount of R922 crore based on the daily average collection in October. This is far more impactful than extending the concession period.

Some respite for power equipment suppliers. Govt for replacing 11,000 MW of older thermal plants with R50,000 cr supercritical tech.

New technology for ageing thermal plants
The power ministry is taking steps to replace 25-year-old thermal power plants with modern, energy-efficient power stations. The move is expected to reduce India’s carbon footprint.

—Vinayak Chatterjee is Chairman of Feedback Infra His Twitter handle: @Infra_VinayakCh A weekly selection of the author’s tweets— with a brief backgrounder—in the infra space, by Adite Banerjie

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