India Infrastructure Finance Company Ltd (IIFCL), a wholly-owned Government of India company provides long term finance to viable infrastructure projects, is planning to raise US$750 million and is in talks with three overseas institutions - Japan International Cooperation Agency (JICA), European Investment Bank (EIB) and French Development Agency (ADF).
IIFCL would raise US$500 million from JICA, US$150 million from EIB and US$100 million from ADF, according to sources.
The state-owned company is planning to raise money through the issue of tax free bonds in tranches on private placement basis. The loan amount will be used to fund clean energy and urban infrastructure projects.
Recently, IIFCL got a loan from ADB to raise $700 million loan to fund infrastructure projects.
IIFCL provides long term finance to viable infrastructure projects through the Scheme for Financing Viable Infrastructure Projects.
Recently, the Reserve Bank of India (RBI) has granted IIFCL the status of an infrastructure non-banking finance company (NBFC), but with relaxed capital adequacy requirements-a move that will allow the company to lend more to infrastructure projects and also not require the government to recapitalize it to meet capital requirement norms prescribed for infrastructure NBFCs.