The Finance Ministry is planning to set up a fund under the National Investment and Infrastructure Fund (NIIF) dedicated for strategic investments. The Ministry’s discussions with investors are at advanced stage and it should be operational soon. Earlier this year, the NIIF kick started its funding activity with Dubai-based ports operator DP World by creating a platform for investing up to $3 billion of equity in the transport and logistics sectors in India.
The NIIF is planning to raise Rs 8,000 crore from various sources for the purpose of funding projects worth Rs 16,000 crore for the current fiscal. The government has provided budgetary support to NIIF by allocating Rs 1,000 crore that will be leveraged for raising Rs 8,000 crore from strategic anchor partners, such as multilateral and bilateral institutions, sovereign wealth funds, pension funds and domestic public sector enterprises.
The NIIF is being operationalised by establishing three Alternative Investment Funds (AIFs) under the SEBI Regulations. The proposed corpus of NIIF is Rs 40,000 crore. The government’s contribution to the AIFs under the NIIF scheme will be 49 percent of the total commitment. The NIIF has mandate to solicit equity participation from strategic anchor partners, like overseas sovereign/quasi-sovereign/multilateral /bilateral investors.