Why is it in the News?

iBUS, a digital infrastructure solutions company, said recently it has raised $200 million from the government-backed National Investment and Infrastructure Fund Limited (NIIF).

What is the National Investment and Infrastructure Fund (NIIF)?

• The National Investment and Infrastructure Fund (NIIF) stands as a pioneering fund manager dedicated to investing in India's infrastructure and related sectors.
• Established in 2015, NIIF marks India's inaugural sovereign wealth fund (SWF), embodying a collaborative investment platform for both international and domestic investors.

Key Aspects of NIIF:

• Investment Mandate: NIIF operates with a mandate to deploy equity capital into domestic infrastructure projects, spanning greenfield, brownfield, and stalled ventures.
  • Its investment horizon extends across diverse asset classes, including infrastructure, private equity, and other sectors, all aimed at delivering attractive risk-adjusted returns.
• Ownership and Independence: With 49% ownership by the Indian government, NIIF boasts over $4.9 billion in assets under management, solidifying its status as the nation's largest infrastructure fund.
  • Despite its close ties with the government, NIIF maintains autonomy in its investment decisions, ensuring a professional and impartial approach to its operations.
• Professional Management: The fund is predominantly owned by institutional investors and managed by a proficient team with expertise in both investments and infrastructure.
  • This professional oversight ensures the strategic deployment of capital and efficient management of investments.
• Regulatory Compliance: NIIF operates within the regulatory framework as an Alternative Investment Fund (AIF) registered with the Securities Exchange Board of India (SEBI).
• It actively raises capital from a spectrum of domestic and international institutional investors, further bolstering its financial resources.

NIIF manages capital through four distinct funds:

• NIIF Master Fund: Focused on infrastructural projects such as roads, ports, airports, and power, it stands as India's largest infrastructure fund.
• NIIF Private Markets Fund: Invests in infrastructure and associated sectors through third-party managed funds.
• NIIF Strategic Opportunities Fund: Devoted to developing large-scale businesses and greenfield projects deemed strategically significant for the nation.
• India-Japan Fund: NIIF's bilateral initiative aimed at environmental preservation in India, with contributions from both the Indian government and the Japan Bank for International Cooperation.
• NIIF catalyzes fostering sustainable infrastructure development in India while facilitating fruitful collaborations between Indian and international stakeholders, exemplifying a robust model for investment-driven growth.

Why in the News?

Recently, the National Investment and Infrastructure Fund collaborated with the Japan Bank for International Cooperation (JBIC) to launch the India-Japan Fund, which amounts to $600 million.

About the National Investment and Infrastructure Fund (NIIF):

• NIIF is a fund manager owned by investors and anchored by the Government of India (GoI).
• It collaborates with both global and domestic institutional investors.
• Established in 2015, NIIF is India's first sovereign wealth fund (SWF).
• NIIF plays a vital role in financing infrastructure projects, including greenfield (new), brownfield (existing), and stalled projects.
• The primary objective of NIIF is to maximize its economic impact by investing in various infrastructure-related projects.

There are three types of NIIF funds:

• Master Fund: This fund primarily invests in infrastructure projects such as roads, ports, airports, and power generation.
• It also invests in well-established enterprises operating under long-term agreements in regulated environments with a strong track record.
• Fund of Funds: This category focuses on investing in funds managed by renowned fund managers with a proven track record.
• It acts as an anchor investor, which encourages fund managers to attract more investments from institutional investors.
• Strategic Fund: Registered as an Alternative Fund II under the Securities and Exchange Board of India (SEBI), the Strategic Fund primarily invests in equity and equity-linked instruments.
• All these funds are registered as Alternative Investment Funds (AIF) with SEBI.