NEW DELHI: Abu Dhabi Investment Authority (ADIA) has made an investment of $1 billion in National Investment and Infrastructure Fund (NIIF) Master Fund. NIIF is an investment vehicle set up by government for funding commercially viable greenfield, brownfield and stalled projects in roads, power and other infrastructure sectors. This is the first investment to NIIF Master fund after it was set up on July 29, 2015 and was envisaged to be established as one or more Alternative Investment Funds (AIFs) under the SEBI Regulations. NIIF has been mandated to solicit equity participation from strategic anchor partners, like overseas sovereign/quasi-sovereign/multilateral/bilateral investors.
The proposed corpus of NIIF is `40,000 crore (around $6 billion). The government’s contribution to the NIIF willbe 49 per cent of the total commitment at any given point of time. The first investment agreement between NIIF Master Fund and a wholly owned subsidiary of Abu Dhabi Investment Authority (ADIA) was signed on Monday.“This is a significant milestone in operationalisation of NIIF. This Agreement paves the way for creating significant economic impact through investment in commercially viable infrastructure development projects,” Subhash Chandra Garg, Secretary Economic Affairs said in a statement.
According to the Memorandum of Understanding (MoU), Department of Economic Affairs, Ministry of Finance and the Government of United Arab Emirates (UAE) will jointly work to mobilise more long-term investment into 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.
The NIIF Master Fund will have six domestic Institutional Investors (DIIs) viz. HDFC Standard Life Insurance Company Ltd, HDFC Asset Management Company Ltd, Housing Development Finance Corporation Ltd, ICICI Bank Ltd, Kotak Mahindra Old Mutual Life Insurance Ltd, Axis Bank Ltd.
In addition, a few investors like Government of UAE, RUSNANO, QIA, RDIF and Japan Overseas Infrastructure Investment Corporation for Transport & Urban Development (JOIN) have signed MoUs with the NIIF.