IFC, a member of the World Bank Group, last week launched a $2.5 billion rupee financing program to strengthen capital markets and support infrastructure development in India.

Under the program, IFC will use a combination of rupee-denominated bonds and swaps to raise local-currency financing of up to $2.5 billion, or INR 15,000 crore over the next five years. Proceeds from the program will be used for infrastructure investments in India.

IFC Executive Vice President and CEO Jin-Yong Cai, said:

"Vibrant capital markets provide critical access to finance for the private sector. Bonds offered under IFC's rupee financing program offer a safe investment alternative for domestic pension funds and other investors, while mobilizing capital to address India's infrastructure needs."

IFC said in a press release that deep, liquid domestic capital markets ensure access to long-term, local-currency finance for the private sector-the key engine of job creation in emerging markets. They mobilize long-term funding for priority sectors such as infrastructure.

Dr. Arvind Mayaram, Finance Secretary and Secretary, Department of Economic Affairs, India's Ministry of Finance, said:

"The onshore bond program marks another important milestone in the engagement between India and IFC. Issuance of onshore bonds by IFC in the Indian bond market, with offer of longer tenor bonds, will deepen the bond market and also provide much needed finance to infrastructure projects."

Last year, IFC issued a $1 billion offshore global bond program linked to the rupee exchange rate. Under the program, IFC offered six separate issuances between November 2013 and April 2014; four with maturities of three years, one of five years, and the final tranche of seven years. This set a benchmark for different tenors in the markets and extended the offshore rupee yield curve from less than three years to seven. The bonds attracted a broad range of international investors.

In FY14, IFC invested $1.2 billion in India to achieve strategic priorities of providing counter-cyclical support to infrastructure, promoting financial inclusion and enhancing access to quality and affordable healthcare to the under-served.