The country's largest bank, State Bank of India has signed a memorandum of understanding with Oman's State General Reserve Fund, for a $100 million Indo-Oman joint investment fund, during Prime Minister dr Manmohan Singh's visit to the West Asian Sultanate.
The Indo-Oman Joint Investment fund will be used for making investments in infrastructure, tourism, health, telecom, utility and urban infrastructure and other sectors.
The fund will have an equity contribution of $100 million or in equivalent currency contributed by both parties equally on mutually agreed terms and conditions. The fund can be enlarged in size to a maximum of $1.5 billion, through long-tenor debt and equity capital in several tranches over the next few years.
The agreement also allows both investors to invite other investors to participate in the fund.
The parties would determine various options for the fund's structure, taking into account all relevant regulatory and tax considerations and jointly prepare a presentation to their respective governments a joint comprehensive proposal (JCP) within three months of signing of this MOU.
The MOU shall be valid and effective for a period of two years from the date of signing the MOU i.e 8th November and may be extended on mutual consent for another similar period. Also the MOU may be terminated by either party with a prior written notice of not less than two months.