India Infrastructure Co. to raise Rs.100 bn to refinance projects

December 7th, 2008 - 10:51 pm ICT by IANS  

New Delhi, Dec 7 (IANS) In order to boost investment in the infrastructure sector, the government Sunday authorised the state-run India Infrastructure Finance Co. Ltd (IIFCL) to raise Rs.100 billion through tax-free bonds by next March.Announcing a Rs.3,000-billion ($60-billion) stimulus package to pump prime the economy, a government statement said IIFCL, set up to finance infrastructure projects in the country, could use the fund to refinance port, highway and power projects, being developed under the public-private-partnership model.

Speaking of the stimulus package, Planning Commission Deputy Chairman Montek Singh Ahluwalia told reporters Sunday evening that around 60 highway projects and several power and port projects were now being cleared by the government.

These projects may experience difficulty in reaching financial closure given the current uncertainties in the financial world.

The bond funds will be used by IIFCL to refinance bank lending of longer maturity to eligible infrastructure projects, he said.

Depending on need, IIFCL will be permitted to raise further resources by issue of such bonds, the government said.

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