MUMBAI: The Asian Infrastructure Investment Bank (AIIB) has committed $200 million investment in India’s National Investment & Infrastructure Fund (NIIF) towards the development of infrastructure projects. The proposed funds will come in two tranches of $100 million each.
“Today, the AIIB board is approving a project… They are investing $100 now and $100 million in the time to come. The $200-million will flow into the NIIF that we have set up,” said Economic Affairs Secretary Subash Garg, adding, “With this kind of a vehicle utilised, it will be possible to multiply the investment in infrastructure to a large multiple.”
Speaking to media on the eve of the AIIB’s two-day annual summit here from Monday, Piyush Goyal, Interim Finance Minister, confirmed that AIIB has approved the first tranche of $100 million on Sunday. He added that India was the largest recipient of concessional finance worth $1.2 billion for infrastructure projects from AIIB.
“This is nearly 28 per cent of the total projects approved by the bank,” he added. Incorporated in 2016, AIIB has approved $4.4 billion investments so far.
According to AIIB vice-president Danny Alexander, the multilateral bank is interested in the fund of funds as it will lead to higher inflows into the infra sector. He added that the bank has a pipeline of $1.9 billion in six projects.
Garg said no one should consider that the AIIB is dominated by a member-country (China) and stressed that it is as much a Chinese bank as the World Bank is American.
To a question on India banning Chinese companies, Garg clarified that investments from companies from the Northern neighbour are welcome, but for concerns on security and not meeting local procurement norms under the initiatives to push local manufacturing.
The two-day event, which gathers representatives from the bank’s 86 members, is being held in India for the first time, and will be addressed by Prime Minister Narendra Modi on Tuesday. India is the multilateral lender’s second-largest contributor of capital and by far its largest recipient of financing.