AIIB’s third annual meeting focuses on infra

Addressing the annual meeting of the Asian Infrastructure Investment Bank (AIIB) in Mumbai, PM Modi said that a ‘New India’ is on the rise backed by economic opportunity for all, knowledge economy, holistic development, and futuristic, resilient and digital infrastructure

June 27, 2018

AIIB, a Beijing-based multilateral development bank, focuses on building infrastructure in the Asia-Pacific region; The bank started its financing operations in January 2016 and in less than three years, it has in its fold, 87 Members

On the occasion, PM Modi called upon AIIB, with committed capital of US$100 billion, to expand its financing from US$4 billion to US$100 billion by 2025; Indian has received project financing worth US$2.4 billion from the AIIB so far

So far AIIB has focused its investment in India on lending to rural infrastructure, energy and power, transportation and telecommunication, water supply and sanitation. Now, India is looking forward to investments in nine more projects

The event was attended by over 3,000 delegates from 86 member countries; It also had several concurrent sessions on critical issues pertaining to environment, low carbon emissions, cross-border rail connectivity, among several others

Inaugurating the third annual meeting of the Asian Infrastructure Investment Bank (AIIB) in Mumbai on June 26, Indian Prime MInister Narendra Modi said that a ‘New India’ is on the rise, backed by economic opportunity for all, knowledge economy, holistic development, and futuristic, resilient and digital infrastructure. AIIB, a Beijing-based multilateral development bank, focuses on building infrastructure in the Asia-Pacific region. The bank started its financing operations in January 2016 and in less than three years, it has in its fold, 87 Members. On the occasion, PM Modi called upon AIIB, with committed capital of US$100 billion, to expand its financing from US$4 billion to US$100 billion by 2025. He added that India and AIIB are both committed to making economic growth more inclusive and sustainable. To this end, the Indian Government is applying novel Public Private Partnership models, Infrastructure Debt Funds, and Infrastructure Investment Trusts to fund infrastructure.

The Indian Government has taken a number of steps to boost investment in essential infrastructure and services, while simplifying regulations for businesses. Social development and economic stability, the two factors that foreign investors look for have been achieved by the Government. As a result, India has come up as one of the most investor-friendly economies in the world owing to an environment that is efficient, transparent and reliable. Speaking further on the occasion, the Prime Minister said that India is trying to develop brownfield assets as a separate asset class for infrastructure investment. Such assets, having passed the stages of land acquisition and environment and forest clearances, are relatively de-risked. Hence, for such assets, institutional investment from pension, insurance and sovereign wealth funds are likely to be more forthcoming, the Prime Minister said. In just over two years, AIIB has approved 25 projects in a dozen countries with a total financing of over US$4.2 billion.

Earlier this week, AIIB has approved investment of up to US$200 million in India’s National Investment and Infrastructure Fund’s (NIIF) Fund of Funds. NIIF, anchored by the Indian Government, is a joint investment platform for international and domestic investors that are keen on investing in commercially viable Indian infrastructure projects. The Indian Government has received project financing worth US$2.4 billion from the AIIB so far. The bank is looking to raise investment in India’s high-growth industries spanning energy (fuel, electricity and renewable energy), transportation, infrastructure, waste and water management. The bank has traditionally prioritised investment in sustainable infrastructure that are socially, economically and environmentally sustainable. This is timely as over 2017-22 India will need US$750 billion for energy, transportation and urban development, and the Government had budgeted US$90 billion for infrastructure spending in for financial year 2018-19.

So far AIIB has focused its investment in India on lending to rural infrastructure, energy and power, environmental protection, transportation and telecommunication, water supply and sanitation and urban development and logistics. Now, the Indian Government is looking forward to investments in nine more projects from the AIIB, as per Finance Minister Piyush Goyal. The AIIB summit concluded on a note to improve connectivity within the Southeast Asian region and in turn enabling citizens to reach their full potential of prosperity and security. The event was attended by over 3,000 delegates from 86 member countries. The meeting also had several concurrent sessions that discussed critical issues pertaining to environment, low carbon emissions, connectivity through railway network across borders, among several others. At the event, many State Governments presented their plannings and projects in infrastructure, which span across connectivity, smart cities, sanitation and logistics hubs.

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