Infrastructure forms foreign funds' core

NEW DELHI: The country’s infrastructure sector seems to have caught the fancy of foreign investors. India-dedicated overseas funds have lined up more than$5 billion for investment in ports, airports, energy and infrastructure services.

The funds are in addition to the $5-billion fund each that 3i, Citigroup and Blackstone have floated in collaboration with Indian Infrastructure Finance Co. While 3i, Citigroup and Blackstone’s dedicated infrastructure funds have been floated in India,a large number of players have launched global funds for investment in the country’s infrastructure in the past few months, a government source said.

The country’s infrastructure bill over five years is expected to be $475 billion. Global private equity funds are expected to help the country part-meet the bill. The government is keen to attract such global funds to invest here in the wake of the sector’s mammoth fund requirement.
The funds target investments mainly in equity of companies operating in infrastructure sector such as highways, ports,railways, telecom etc or directly in projects through special purpose vehicles formed to implement projects, the source said.

Atherstone India Invest, a joint venture between Mumbai-based Atherstone group and Switzerland-based India Invest hasfloated a $1-billion fund which is focusingon investing in infrastructure service companies. Australian fund AMP Capital Investors has lined up $500 million for Asian power and port projects, more than half of which is destined for India.

Australia-based Macquarie Infrastructure Group — which has launched dedicated funds with corpus of over $15 billion for Europe, North America, South Korea and global airports — has joined the bandwagon with a $1-billion dedicated India fund.Besides, DLF-Laing O’rourke combine has a $1.5-billion fund that has plans to invest in railways, national highways, airports, oil, gas and water pipelines.