ROADIS, NIIF TO INVEST $2 BILLION ON ROAD PROJECTS
04, Apr 2019
Prelims level : Economics Mains level : GS3 (Investment models)
Why in News:
- Roadis, a private investor and operator of transport infrastructure worldwide and the National Investment and Infrastructure Fund (NIIF) have jointly set up a platform to invest in road projects in India.
- It targets toll-operate-transfer models, acquisitions of existing road concessions and investment opportunities in the road sector with an aim to create a large roads platform in the country. National Investment and Infrastructure Fund (NIIF)
- National Investment and Infrastructure Fund (NIIF) is a fund created by the Government of India for enhancing infrastructure financing in the country.
- Securities and Exchange Board of India (SEBI) has already approved NIIF as an alternate investment fund. The National Investment and Infrastructure Fund (NIIF) Limited has been incorporated as a company under the Companies Act, 2013.
- The government will invest Rs 20,000 crore into the NIIF from the Budget, with another Rs 20,000 crore expected to come from private investors.
- It is India‘s first sovereign wealth fund. It has been set up as fund of funds structure with aim to generate risk adjusted returns for its investors alongside promoting infrastructure development. It aims to attract investments from both domestic and international sources for infrastructure development in commercially viable projects both Greenfield and Brownfield, including stalled projects.
Functions of NIIF
- Fund raising through suitable instruments including off- shore credit enhanced bonds, and attracting anchor investors to participate as partners in NIIF.
- Servicing of the investors of NIIF.
- Considering and approving candidate companies/institutions/ projects (including state entities) for investments and periodic monitoring of investments.
- Investing in the corpus created by Asset Management Companies (AMCs) for investing in private equity.
- Preparing a shelf of infrastructure projects and providing advisory services.
- It has targeted corpus of Rs 40,000 crore to be raised over the years — 49% of it will be funded by government at any given point of time.
- The remaining 51% will be raised from domestic and global investors, including international pension funds, sovereign wealth funds, multilateral/bilateral investors.
- Its Governing Council is chaired by Finance Minister and has already been set up to act as an advisory council to the NIIF.