Mumbai: The National Investment and Infrastructure Fund (NIIF) of India on Monday said it had signed an investment agreement worth $1 billion with a wholly owned unit of the Abu Dhabi Investment Authority (ADIA).
As part of the partnership agreement, ADIA will become the first institutional investor in NIIF’s Master Fund and a shareholder in National Investment and Infrastructure Ltd, NIIF’s investment management company, NIIF said in a press statement.
“This agreement marks the culmination of an extensive process of collaboration with ADIA to develop an investment structure that is attractive to international investors, while remaining closely aligned with NIIF’s objectives," said NIIF chief executive officer Sujoy Bose.
NIIF was set up in 2015 as an investment vehicle for funding commercially viable greenfield, brownfield and stalled projects in the infrastructure sector.
NIIF will invest in areas such as energy, transportation, housing, water, waste management and other infrastructure-related sectors in India.
The corpus of the fund is proposed to be around Rs40,000 crore, with the government investing 49% and the rest to be raised from third-party investors such as sovereign wealth funds, insurance and pension funds, endowments etc.
“NIIF is set to play an important role in facilitating the flow of foreign capital into India’s infrastructure sector. As a long-standing investor in India and in infrastructure globally, ADIA welcomes the opportunity to be the first to partner with NIIF in a platform that is sure to be of interest to other long-term institutional investors," said Khadem AlRemeithi, executive director of the real estate and infrastructure department at ADIA.
ADIA has been an active investor in the Indian infrastructure space. In October 2015, ADIA led a $265 million investment in Sumant Sinha’s renewable energy company ReNew Power Ventures along with existing investors.
In July, The Economic Times had reported that ADIA was in talks to acquire a 49% stake in infrastructure firm GMR Infrastructure’s Hyderabad airport.