In a big boost to fast-track the transition of India to a developed economy, the Indian government has launched a mammoth Rs 40,000-crore (around $6 billion) National Investment and Infrastructure Fund (NIIF), which is also expected to get support from major G20 economies.
The chief executive of NIIF will be appointed by the end of January 2016.
The fund was announced by Finance Minister Arun Jaitley in his 2014-15 budget speech. Mr Jaitley chaired the first meeting of the NIIF’s governing council, where he mentioned that several sovereign funds and pension funds from Russia, Singapore, UK and UAE are willing to participate in the fund. “The progress with regard to the proposals of sovereign funds from the UAE, UK and Russia were particularly discussed, including the expressions of interest from other countries,” Mr Jaitley said. “We will meet again in March to review the progress on each of these funds that intends to invest in NIIF,” he added.
Discussing the possible projects that may be taken up under the NIIF, the council also held meetings to flesh out a roadmap for the future. The search-cum-selection committee, formed under the aegis of department of economic affairs secretary Shaktikanta Das, has already held two meetings regarding the appointment of NIIF CEO. “We hope the CEO selection process is completed over the next few weeks,” Mr Jaitley said in his address to the media after his meeting.
The governing council also noted the possible projects that may be taken up under the NIIF during the meeting on December 29. Minister of State for Finance Jayant Sinha also attended the meeting. It was decided that the government will put in Rs 20,000 crore into the NIIF, while another Rs 20,000 crore would be injected by the private investors. “The market regulator Securities and Exchange Board of India (SEBI) has approved setting up of the NIIF,” a finance ministry statement said.
The cabinet had approved setting up of the sovereign wealth fund NIIF in July. The NIIF will look at all commercially viable projects both greenfield and brownfield in India, including the stalled ones. It will also provide equity finance to infrastructure projects with long gestation period. The government would hold 49 percent in the NIIF, which would take independent investment decisions and the organisation would be headquartered in Mumbai.
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