Set up as India's first sovereign wealth fund, NIIF today said it has raised plenty of capital and will be signing its first investment proposal in the next few days.
The government had set up the Rs 40,000-crore National Investment and Infrastructure Fund (NIIF) in December 2016 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.
"We have been at this for about a year and we are actually quite pleased that we had first closure of our fund. We have plenty of capital to invest and we are about to sign our first investment in next few days," NIIF CEO Sujoy Bose said.
He was speaking at the third edition of the geo-political conference, 'Raisina Dialogue' here.
The corpus of NIIF is proposed to be Rs 40,000 crore wherein the government will invest 49 per cent.
It will raise third party capital for the remaining Rs 20,000 crore from long-term international investors, such as a sovereign wealth funds, insurance and pension funds, and endowments.
Bose said that international investors usually look at macro economic parameters, stable political scenario and growth potential before making investment commitments.
He said investors feel that investments into private instruments are risky. NIIF investors can find comfort in the fact that the government is also investing in the same project.
"We believe that there is substantial investment going to come into India. Once you have a situation where there is familiarity from political standpoint, there is economics and market that companies from certain country are seeking, investment follows," Bose said.
He said bulk of funds would move into infrastructure investments into India over the next few decades and NIIF would play a role in channelising the investments.
Bose further said that the Insolvency and Bankruptcy Code (IBC) is a huge reform and would provide clarity to investors wishing to invest in India's infrastructure sector.
The corpus of the NIIF is proposed to be Rs 40,000 crore (USD 6 billion) wherein the government will invest 49 per cent.
It will raise third party capital for the remaining Rs 20,000 crore (USD 3 billion), from long-term international investors, such as a sovereign wealth funds, insurance and pension funds, and endowments.
In October 2017, Russia also agreed to pump in USD 500 million NIIF. In November 2017, India-UK sub-fund under NIIF will initially raise 500 million pound (about Rs 4,150 crore) and also seek to leverage private investments from London for funding infrastructure projects in India.
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