The Union Cabinet is likely to consider a proposal to infuse ₹6,000 crore into the National Investment and Infrastructure Fund (NIIF), a move which will help the entity raise ₹1.10-lakh crore by 2025 for financing infrastructure projects, PTI reported.
On Nov 12, Union Finance minister Nirmala Sitharaman announced that the government will infuse ₹6,000 crore equity in NIIF’s debt platform, in its attempt to drive infrastructure creation in the country.
“NIIF attracts a lot of sovereign fund for investment in infrastructure-related activities. It also has a debt platform through which it also raises a lot of money and by 2025 it has to provide and infra funding to the extent of ₹111 lakh crore national infrastructure pipeline (NIP),” Nirmala Sitharaman said at a press briefing when she unveiled the Aatmanirbhar Bharat 3.0 package.
The infusion is likely to be made into the infra debt fund and infra finance company floated by
NIIF will leverage this equity to raise ₹1.1 lakh crores over the next five years to finance infrastructure projects under the national infrastructure pipeline.
NIIF Strategic Opportunities Fund has set up a debt platform comprising an NBFC Infra Debt Fund and an NBFC Infra Finance Company. The platform has a loan book of ₹8,000 crore and deal pipeline of ₹10,000 crore.
The Strategic Opportunities Fund, one of the three funds – which has a more diversified investment strategy, including green-field projects and debt platforms – has a funding commitment of $1 billion from the government. Remaining equity will be raised from private investors.
To support the funding of the National Infrastructure Pipeline of ₹111 lakh crore, Finance Minister Nirmala Sitharaman in her Budget speech this year had said about ₹22,000 crore has already been provided. This would be towards equity support to infrastructure finance companies such as India Infrastructure Finance Company Ltd (IIFCL) and a subsidiary of NIIF, the Minister had said.
“They would leverage it, as permissible, to create financing pipeline of more than ₹1,00,000 crore. This would create a major source of long-term debt for infrastructure projects and fulfil a long-awaited requirement,” Nirmala Sitharaman had said