Mumbai: Infrastructure Development Finance Company Ltd (IDFC) has entered into a memorandum of understanding (MoU) with India Infrastructure Finance Company Ltd (IIFCL) to combine their resources and expertise to finance infrastructure projects.

The MoU would help both IDFC and IIFCL to co-operate in creating a pipeline of commercially viable infrastructure projects and evolve fast track approval processes for co-financing. IDFC would appraise projects and undertake necessary activities to facilitate financial closure for projects, the company said in a filing with the Bombay Stock Exchange (BSE).

"The joint effort of IDFC and IIFCL seeks to address the huge infrastructure financing needs of the country. India needs to invest over $475 billion over the next five years and a collaborative approach is essential to develop the right structures to expedite financial closure of infrastructure projects. We look, forward to working with IIFCL in financing eligible infrastructure projects and to complement each others strengths, skills and expertise in expediting the investments in Indian, infrastructure," Rajiv Lall, managing director and CEO of IDFC said.

IDFC, the largest infrastructure fund in India, has a corpus of Rs2,800 crore ($632 million)

For the quarter ended June 30, 2007, IDFC posted a profit after tax of Rs167.81 crore as compared to Rs121.23 crore for the quarter ended June 30, 2006. Total income has increased from Rs321.48 crore to Rs556.80 crore. The group reported consolidated profit after tax of Rs180.98 crore for the quarter as compared to Rs131.15 crore for the quarter ended June 30, 2006. Total Income has increased from Rs339.17 crore to Rs609.70 crore for the quarter ended June 30, 2007.

IIFCL was set up by the government to provide long-term debt for infrastructure projects. IIFCL enters into tripartite agreements with the lead bank and co-lead bank for projects where lead bank guarantee was not contemplated.