Beijing: The New Development Bank (NDB) set up by the Brics countries — Brazil, Russia, India, China and South Africa — plans to issue bonds this year in Indian rupee and Chinese yuan, its president K. V. Kamath said on Friday.
The bank sold its first ¥3 billion yuan-denominated bonds in China last year in July to fund clean energy projects in member-states. Kamath, a former executive with India’s largest private lender ICICI Bank, told the state-run Xinhua news agency that after last year’s issuance of bonds, the preparation for the second batch of yuan-denominated bonds, possibly in the second half of this year, is expected to be more smooth.
The size will be around ¥3 billion, similar to the last one. He said the issuance will come after the bank is rated by international rating agencies. Between $300-500 million of rupee-denominated ‘masala’ bonds will be issued after July, added Kamath, who is based in Shanghai.
‘Masala’ bonds are rupee-denominated bonds issued outside India. Kamath said the NDB plans to lend $2.5-3 billion to fund 15 projects to member-states this year, up from $1.5 billion for seven projects in 2016.
Most projects last year were connected to clean energy and transportation. Kamath said the loans will go to more sectors this year. For example, in India the bank will prioritise rural drinking water networks and infrastructure projects.
The Brics bank was set up with an initial authorised capital of $100 billion after leaders of Brazil, Russia, India, China, and South Africa signed a treaty for its establishment during the sixth Brics Summit in Fortaleza, Brazil, in 2014. It officially opened in Shanghai in 2015. PTI