- IL&FS signed a Memorandum of Understanding (MoU) with five Public Sector General Insurance Companies i.e. General Insurance Corporation of India (the Government re-insurer), National Insurance Company Ltd, the Oriental Insurance Co Ltd, the New India Assurance Co Ltd and United India Insurance Co Ltd to jointly facilitate business of IDF and in the process contribute their bit to the development of infrastructure sector in India.
- it would send strong signal to the foreign sovereign funds /pension funds to also start investments in Indian infrastructure
Related information
Infrastructure debt fund- IDFs are investment vehicles which can be sponsored by commercial banks and NBFCs in India in which domestic/offshore institutional investors, specially insurance and pension funds can invest through units and bonds issued by the IDFs.
IDFs would essentially act as vehicles for refinancing existing debt of infrastructure companies, thereby creating fresh headroom for banks to lend to fresh infrastructure projects.
IDF-NBFCs would take over loans extended to infrastructure projects which are created through the Public Private Partnership (PPP) route and have successfully completed one year of commercial production. Such take-over of loans from banks would be covered by a Tripartite Agreement between the IDF, Concessionaire and the Project Authority for ensuring a compulsory buyout with termination payment in the event of default in repayment by the Concessionaire.
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