Abu Dhabi Investment Authority to invest $1 bn in NIIF

The Dollar Business Bureau

In order to mobilise funds into the India’s infrastructure sector, the first investment agreement signed on Monday between National Investment and Infrastructure Fund (NIIF) Master Fund and a fully-owned subsidiary of Abu Dhabi Investment Authority (ADIA). For this, ADIA will do an investment of $1 billion in the NIIF. 

“As a part of the agreement, ADIA will become the first institutional investor in NIIF’s Master Fund and a shareholder in the NIIF’s investment management Company,” according to a statement from Ministry of Finance.

Along with ADIA and Government of India, six Domestic Institutional Investors (DIIs) including HDFC Asset Management Company Ltd, HDFC Standard Life Insurance Company Ltd, Housing Development Finance Corporation Ltd, Kotak Mahindra Old Mutual Life Insurance Limited, ICICI Bank Limited and Axis Bank Limited will join the Master Fund.

“This is a significant milestone in operationalisation of NIIF, said Economic Affairs Secretary Subhash Chandra Garg.

“This Agreement paves the way for creating significant economic impact through investment in commercially viable infrastructure development projects,” he added.

The proposed corpus of NIIF is around $6 billion (Rs.40,000 crores). The contribution of Government of India will be 49% of the overall commitment. The NIIF has also been directed to get equity participation from overseas investors.

The NIIF was set up in July 2015 and was envisioned to be established as one or more Alternative Investment Funds (AIFs), under the Regulations of Securities and Exchange Board of India (SEBI).

A Governing Council has been created, with Finance Minister Arun Jaitley as Chairman, to act as an advisory council to NIIF.