India, UK weigh sub-fund under NIIF umbrella

India and the UK are exploring the possibility of setting up a sub-fund under the National Investment and Infrastructure Fund (NIIF).

At a meeting with UK Secretary of State for International Trade, Liam Fox, Finance Minister Arun Jaitley today said the central government accords high priority to investment in infrastructure, manufacturing and service sectors.

The government has set up NIIF to attract equity investments for development, he said, adding that the officials from both India and the UK are jointly exploring creation of an Indo-UK sub-fund under the NIIF umbrella.

"We look forward to implementation of this task expeditiously and positively in the near future," he said.
 

The Rs 40,000-crore NIIF was set up in December as an investment vehicle for funding commercially viable greenfield, brownfield and stalled projects. It was envisioned as a mother fund with several sectoral feeder funds.

The government is to contribute Rs 20,000 crore to the fund and the remaining is expected to be raised through sovereign wealth funds.

India has proposed termination of the Bilaterally Investment Promotion Agreement (BIPA) as the Union Cabinet has approved a new model text for the Bilateral Investment Treaty (BIT), he said.

The new text of the BIT was already shared with the UK government in April 2016.

The finance minister also raised the issue of Brexit implications on Indian businesses and working professionals in the UK.

The UK is among India's major trading partner and despite the global economic slowdown and the euro zone crisis, India-UK bilateral trade has been resilient, Jaitley noted.

He also mentioned a new Free Trade Agreement (FTA) with the UK, linked to terms and conditions of the latter's withdrawal arrangement from the EU.

Earlier speaking on the occasion, Fox said the UK is interested in forging deeper trade and investment arrangements with India.

Fox, who is on 3-day visit to India, announced his participation and the UK's commitment to the Joint Economic and Trade Committee (JETCO) to be held on November 7 alongside the India-UK Tech Summit.