Temasek gets nod for Reliance power fund

The government cleared Singapore-based Temasek's proposal to invest Rs 450 crore ($100 million) in a power sector fund along with leading power utility Reliance Energy Ltd, which has already invested an equal amount in the fund.

The $200-million fund, yet to be named, will invest in power projects in the country, generation, distribution and transmission. It is expected to take off in a month.

Finance Minister P Chidambaram cleared the Temasek proposal after it was approved by the Foreign Investment Promotion Board. Temasek, the Singapore government's investment arm, is routing the investment through a Mauritius-based investment company, Aranda Investments.

This will be the latest in a string of investments Temasek has made in India. Temasek has also set up the $100 million Merlion fund, which will invest in small and mid-sized Indian companies. It is eager to invest in various sectors in India, including pharmaceuticals and civil aviation.

Reliance Energy Ltd, earlier BSES Ltd, is India's leading integrated power utility company in the private sector. The company is putting up a 3500 MW gas-based power project in Uttar Pradesh at a cost of Rs 10,000 crore. This is billed as the world's largest gas-based greenfield project.

The Temasek proposal was among 48 foreign direct investment proposals involving an investment of around Rs 794 crore, cleared by the finance minister.

The government also cleared a Rs 225-crore proposal by Mumbai-based financial investment entity Deutsche India Holdings to set up a holding firm with the Singapore-based Deutsche Asia Pacific Holdings.

The government also okayed a proposal by Saint Gobain Weber to set up a wholly owned subsidiary involving an investment of Rs 30 crore, a Rs 17.3 crore proposal by Goa Optolab, a Rs 16.2 crore proposal by Allied Domecq Spiritis & Wine and a Rs 15 crore proposal by the Bangalore-based IT-enabled services company Viteos Technologies.

Other companies whose plans were approved, include GE Lighting India, Tata Honeywell, Tupperware, mphasis BFL, Qualcomm and Convergent software.