Mumbai: The Asian Infrastructure Investment Bank (AIIB) board on Sunday cleared a $200-million investment into the National Infrastructure Investment Fund that will help funnel up to $2.4 billion into the infra sector later.
The proposed fund will come in two tranches of $100 million each and will go into a fund of funds to be floated by the NIIF, top finance ministry officials said here today.
"The AIIB board has approved an investment in the NIIF, and the first tranche of $100 million has got approved today [Sunday], which would be followed by a similar tranche on call," interim finance minister Piyush Goyal said here.
India for the first time is hosting a two-day annual meet of AIIB's board of governors here from Monday (today).
Economic affairs secretary SC Garg said there can be a leverage of 10-12 times on the money to be invested by the AIIB, which means nearly $2.4 billion of investments can take place in the sector.
He said the money will come into the fund of funds like the green growth equity fund backed by the British government and will act as a platform to invest into other funds that will invest in infra projects.
AIIB vice-president Danny Alexander said the multilateral bank is also interested in the fund of funds as it will lead to a higher inflows into the infra sector.
The 2016-incorporated, Beijing-headquartered AIIB has approved $4.4 billion investments in the country so far--its second largest shareholder after China-which includes the earlier approved $1.2 billion, and making the country the largest beneficiary so far.
The bank has a pipeline of $1.9 billion in six projects and Alexander said it is interested in projects in the transport, energy, water and waste management areas given the large requirements in these sectors.
Garg said government has sent a proposal to AIIB to infuse $475 million into the Mumbai Urban Transport Project-III,and has already got an in-principle approval.
Goyal said the AIIB has "matured in a short period of time and is rapidly progressing to one of the major infra financiers at the global stage". He also said the bank president has lauded India for its enthusiasm in putting up good investment proposals.
Garg also said one of the proposals includes financing the Mumbai metro's line 4 as well.
The financial capital is regaining its importance and the slew of infra projects including multiple metro lines, the trans-harbour link, coastal road and a new international airport will convert the megapolis into the "infra capital" of the country as well, Goyal said.
Updated Date: Jun 25, 2018 10:43 AM