IIFC deal with Sumitomo to raise $5 billion

India Infrastructure Finance Company today signed a memorandum of understanding with Japan's largest bank Sumitomo Mitsui Banking Corporation (SMBC) for raising $5 billion in the next five years for infrastructure projects.

SMBC will raise resources for IIFCL from Japanese and other global markets both in yen and dollar. The Japanese banking major today sanctioned $200 million.

"We will arrange the financing in competitive terms for IIFCL," said SMBC India country head (International Finance Department) Bharat Kaushal.

IIFCL sources said raising money from Japanese market is cheaper compared to other global markets.

This is the third agreement signed by IIFCL to raise $5 billion each from overseas market. Earlier, it had signed agreements with UK-based private equity firm 3i Group Plc; and IDFC, Citigroup and Blackstone.

IIFCL has also conducted road shows in United States, United Kingdom and Singapore for raising up to $ 500 million by December.

According to an estimate, India requires $ 475 billion for infrastructure projects in the next five years.