India Infrastructure Finance Company Ltd (IIFCL) on 17 January 2014 signed an agreement with the Export-Import Bank of Korea (K-EXIM) for infrastructure finance. As per the IIFC’s statement the signed MoU covers cooperation in project and investment financing related to infrastructure as well as other finance areas of mutual interest.
The Union government has already drawn up plans to make huge investments in infrastructure sector. The Korean government has also shown its keen interest in development of infrastructure in India as it has a variety of overseas experience.
The MoU was exchanged between the S.B. Nayar, Chairman and Managing Director of IIFCL and Kim Yong-hwan, Chairman and President, K-EXIM. This MoU between the IIFCL and K-EXIM has been signed at the time of India visit of the South Korean President Park Geun-hye.
About India Infrastructure Finance Company Ltd (IIFCL)
IIFCL was incorporated under the Companies Act as a wholly-owned Government of India company in January 2006 and commenced operations from April 2006. It basically provides long term finance to viable infrastructure projects through the Scheme for Financing Viable Infrastructure Projects through a Special Purpose Vehicle called India Infrastructure Finance Company Ltd (IIFCL), broadly referred to as SIFTI.
Sectors that are eligible for financial assistance from IIFCL as per the list of infrastructure approved by the Cabinet Committee on Infrastructure of 1 March 2012, the projects includes:
• Social and commercial infrastructure
• IIFCL accords overriding priority to Public-Private Partnership (PPP) Projects
About Export-Import Bank of Korea (K-EXIM)
K-EXIM is a Korean government funded export credit agency, which provides export financing with the guarantees that includes other forms of credit services to facilitate trade. It also looks forward to the overseas investment of the Korean companies. It was established in 1976 and since its establishment has supported the export-led economy of Korea and facilitated economic cooperation with the foreign countries.
Korea Eximbank's primary services include export loans, trade finance, and guarantee programs structured to meet the needs of clients in a direct effort to both complement and strengthen the clients' competitiveness in global markets. The bank also provides overseas investment credit, natural resources development credit, import credit, and information services related to business opportunities abroad.
Comment: The signed MoU of IIFCL and K-EXIM has set-up the chance of information exchange related to infrastructure projects in India. This also provides investment of South Korea in infrastructure projects that will be identified by them.