The Union Finance Minister Shri P. Chidambaram said that for Infrastructure Debt Funds (IDFs), we should try to mobilise resources from insurance and pension sectors as these funds are available for long term horizon. The Finance Minister Shri Chidambaram was speaking after launching the maiden IDF scheme of IIFCL Mutual Fund (IDF) here today. The Finance Minister later handed over In-Principle sanction approval letters issued by IIFCL Asset Management Company Limited (IAMCL) to one Power Project in Jharkhand and one Rural Water Project in Andhra Pradesh. Both the projects are in operational phase. The Finance Minister Shri Chidambaram said that in order to give thrust to investment in infrastructure sector and to attain GDP growth rate of 8%, there is an immense need for financial products such as IDFs, Takeout Finance and Credit Enhancement to fill the financial gap in the infrastructure sector. The Finance Minister Shri Chidambaram congratulated IIFCL and the other participating investors of IIFCL Mutual Fund (IDF) for this landmark event of launch of the IDF scheme, which will pave the way for setting-up of more such infra debt funds.

On this occasion, Dr Arvind Mayaram, Secretary, Department of Economic Affairs, Shri Rajiv Takru, Secretary, Department of Financial Services, Shri V.P Baligar, CMD, HUDCO and CMDs of Canara Bank and Corporation Bank along with ED, OBC were also present among others.

Later IIFCL Asset Management Company Limited (IAMCL), an Asset Management Company (AMC) promoted by India Infrastructure Finance Company Limited (IIFCL) to manage the IIFCL Mutual Fund (IDF) signed a Memorandum of Understanding (MoU) with three (3) Public Sector Banks (PSBs) including Canara Bank, Oriental Bank of Commerce & Corporation Bank and two (2) Financial Institutions (FIs) including the IIFCL & HUDCO to launch maiden Infrastructure Debt Funds for catalysing investments by way of securitised debt instruments of Infrastructure Projects/Companies.

IIFCL Mutual Fund (IDF) has launched its maiden Infrastructure Debt Fund scheme with the support of investors viz. Canara Bank and HUDCO being the Strategic Investors and Corporation Bank, Oriental Bank of Commerce & IIFCL being the other investors. The maiden IDF scheme will mainly undertake investment in debt securities or securitized debt instruments of infrastructure companies, infrastructure capital companies or infrastructure projects, SPV, Bank Loans etc. with the investment objective of capital appreciation and trade on the Stock Exchange, aimed at development of bond market in the country.

Earlier , Sh. S.K. Goel, Chairman & Managing Director, IIFCL in his welcome address said that IDF will complement commercial banks in providing the required long term funding to infrastructure sector and help in addressing their Asset Liability Mismatch (ALM) problems. He further added that IIFCL is targeting an initial corpus of USD 1 billion by attracting both domestic and international investors. He also mentioned that IIFCL, as a premier developmental financial institution, is promoting other similar products like Takeout Finance and Credit Enhancement in its efforts in taking India’s infrastructure growth story to the next level.

The regulations for Infrastructure Debt Fund, through Mutual Fund and NBFC route, were issued by the financial regulators, SEBI and RBI, following the announcement made by Government of India in financial year 2011-12.

DSM/RS/ka

(Release ID :96599)

Infrastructure Debt Funds mobilise long-term institutional capital via securitised debt to catalyse infrastructure investment and bond market development. The IDF scheme launched by IIFCL Mutual Fund seeks to mobilise long term institutional capital from insurance and pension sectors to invest in debt securities and securitised debt instruments of infrastructure projects, SPVs, bank loans and infrastructure companies, with objectives of capital appreciation, bond market development and addressing banks' Asset Liability Mismatch. The fund is managed by an AMC promoted by IIFCL with strategic participation from public sector banks, financial institutions and HUDCO, and operates under regulatory frameworks for the Mutual Fund and NBFC routes.