The India Infrastructure Finance Company Ltd (IIFCL) is confident that its proposed $1 billion-infrastructure debt fund (IDF) would be operational by end-May. The capital market regulator SEBI has given its in-principle nod for this fund, Mr S.K.Goel, Chairman & Managing Director of IIFCL, said.
The infrastructure lender would invest close to Rs 1,500 crore in the IDF, being set up through the mutual fund route. There are plans to bring in such public sector lenders as PNB and Oriental Bank as members of the Board of Trustees for monitoring the fund.
Of the total amount of $1 billion, the domestic investors — IDBI Bank and LIC, besides IIFCL — will bring $500 million, while the balance will come from foreign investors, Mr Goel said. IIFCL is in talks with Asian Development Bank, Barclays and HSBC to rope them in as foreign investors. While ADB may bring in $200 million, HSBC and Barclays are looking at investments of $150 million each in the proposed fund, he said.
Mutual fund route
IIFCL had earlier indicated that its IDF would be up and running by end February. The infrastructure lender was initially looking to set up an IDF through non-banking finance company, but later changed tack and decided to float a fund through the mutual fund route.
Last June, the Finance Ministry had come out with guidelines allowing IDFs to be set up either as trusts or non-banking finance companies. While the trust-based IDFs would be regulated by SEBI, those set up as NBFCs would come under the RBI's ambit, the Finance Ministry guidelines said.