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| IIFCL to raise $500 mn through UK subsidiary |
| Press Trust Of India / New Delhi Aug 14, 2009, 01:41 IST |
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State-owned infrastructure funding company IIFCL is planning to raise US$500 million (Rs 2,500 crore) through its UK-based subsidiary for financing import of capital goods for infrastructure development.
“In the first tranche, we have raised US$250 million and financed nine projects. Going forward, we plan to raise another US$500 million through our London subsidiary,” India Infrastructure Finance Company (IIFCL) Chairman and Managing Director S S Kohli said.
According to the mandate, IIFCL (UK) would borrow a small part of the foreign exchange reserves from the Reserve Bank of India and lend to Indian companies implementing infrastructure projects solely for meeting their capital expenditure outside India, he said.
The subsidiary will be borrowing up to US$5 billion from the RBI by way of issuance of US dollar-denominated bonds, he said. Giving the break-up of the project financed through this subsidiary, Kohli said,
so far the subsidiary has sanctioned about US$1.4 billion for nine projects for import of infrastructure equipment.
The total project cost is around US$12 billion and the approved loan portfolio comprises seven projects from the power sector and two urban mass rapid transport sector, he added.
IIFCL is also planning to raise up to Rs 5,000 crore through taxable bonds from the domestic market to fund various projects. This is over and above Rs 30,000 crore, which the government allowed the IIFCL to raise from the domestic market as tax-free bonds to enable refinancing various projects in the core sector, particularly highways and port.
The company, Kohli said, has already raised Rs 2,000 crore from the market during the current fiscal. The funds would be raised for financing infrastructure sector projects across the sectors, he said, adding “we are talking to different companies and are waiting for financial closures”.
The company, which was incorporated by the government in 2006 to fund infrastructure projects, has disbursed Rs 4,800 crore for 77 projects till March 2009.
During the fiscal, Kohli said, “we have disbursed Rs 3,200 crore as compared to Rs 1,541 crore in the previous fiscal.”
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