Govt pledges extra Rs 30,000 cr for NIIF

New Delhi: The government has pledged an additional investment of Rs 30,000 crore towards new and upcoming funds of the National Investment and Infrastructure Fund (NIIF), taking its total commitment to the quasi-sovereign wealth fund to Rs 60,000 crore.The Cabinet approved this proposal last week, the finance ministry said on Monday.Also Read: NIIF raises $750 million for its second private market fundIt’s expected to spur investments across sectors, including transportation, energy, digital infrastructure, urban infrastructure, e-mobility and other nationally important projects, the ministry said, underscoring the NIIF’s role in bringing additional private capital and aiding growth.

It comes at a time of heightened external headwinds for the economy, especially the West Asia war.The additional Rs 30,000-crore investment commitment will be used for setting up of the NIIF’s second infrastructure-focussed fund--the successor to its first flagship fund with this mandate.

It will also support the sovereign-backed fund’s new strategies and bilateral and other strategic funds.The government is a 49% shareholder in the NIIF, which currently manages capital commitments of about Rs 40,000 crore across its funds and investment strategies.The NIIF has displayed a strong track record of capital deployment and realisations, having returned close to Rs 12,000 crore to investors through large portfolio exits, the ministry said.Also Read: NIIF to make a $700-million first closure of $1 billion Private Markets Fund IIIt has raised capital from important institutional investors, including Abu Dhabi Investment Authority, AustralianSuper, CPP Investments, Ontario Teachers’ Pension Plan, PSP Investments, Temasek, Asian Infrastructure Investment Bank, Asian Development Bank, Japan Bank for International Cooperation and US International Development Finance Corporation.The latest government move would have a catalytic impact on the economy through investments in underlying assets and portfolio companies, the ministry said.

It will contribute to high-quality infrastructure, job creation and broader economic growth, supporting India’s ambition to emerge as a developed country by 2047, it added.Its four operational investment strategies — infrastructure, private markets, growth equity, and climate investments in the India-Japan business corridor — have “achieved notable investment momentum”, the ministry said.NIIF’s first infrastructure fund, with a corpus of Rs.

16000 crore, is India’s largest domestic infrastructure fund and has created platforms across transportation, energy and digital infrastructure.Its Private Markets Fund has invested in multiple daughter alternative investment funds managed by home-grown managers, which in turn have invested in areas such as climate, affordable housing, affordable healthcare, and venture capital technologies.The focus areas of the NIIF’s Strategic Opportunities Fund include financial services, healthcare and manufacturing.

Its India-Japan Fund is its first bilateral fund and focuses on climate and circular economy and energy transition, as well as investments that further the India-Japan business corridor. ...