Tap insurance, pension sectors for infra funds: Chidambaram

Finance minister P Chidambaram today called for mobilising long-term resources from the insurance and pension sectors for infrastructure debt funds (IDFs).

''We should try to mobilise resources from insurance and pension sectors as these funds are available for long term horizon,'' Chidambaram said after launching the maiden IDF scheme of IIFCL Mutual Fund in New Delhi today.

Launching the IDF, finance minister said there was a need to create more financial products such as the IDF, Takeout Finance and Credit Enhancement to meet the financial needs of the infrastructure sector.

He said a thrust on infrastructure sector investment is needed for the country to attain GDP growth rate of a minimum 8 per cent.

IIFCL today signed a memorandum of understanding (MoU) with three public sector banks (PSBs), including Canara Bank, Oriental Bank of Commerce and Corporation Bank and two financial institutions, including the IIFCL and HUDCO, to launch maiden IDFs for catalysing investments by way of securitised debt instruments of infrastructure projects/companies.

IIFCL Mutual Fund (IDF) also launched its maiden IDF scheme with the support of Canara Bank and HUDCO as strategic investors and with support from Corporation Bank, Oriental Bank of Commerce and IIFCL.

The maiden IDF scheme will mainly undertake investment in debt securities or securitised debt instruments of infrastructure companies, infrastructure capital companies or infrastructure projects, SPVs, bank loans etc with the objective of capital appreciation and trade on the stock exchange.

The finance minister later handed over in-principle approval letters issued by IIFCL Asset Management Company Limited (IAMCL) to one power project in Jharkhand and a rural water supply project in Andhra Pradesh.

Both the projects are in operational phase.

IIFCL Asset Management Company Limited (IAMCL), is an asset management company (AMC) promoted by India Infrastructure Finance Company Limited (IIFCL) to manage the IIFCL Mutual Fund (IDF).