AIIB in talks with India on sovereign infrastructure project pipeline

Mint

6 days ago

New Delhi: Beijing-based Asian Infrastructure Investment Bank (AIIB), in which India is the second largest shareholder after China, is holding discussions with the Central and state governments as well as Indian industry to finance a robust pipeline of sovereign and private sector projects, AIIB vice president Ajay Bhushan Pandey said on Tuesday.
The development bank is working towards stepping up annual project financing from about $10 billion last fiscal to $17 billion over the next few years.
Pandey, who is on a visit to India, said AIIB finances projects not only in traditional infrastructure, but also in digital public infrastructure, data centres, digital communication, affordable housing, health and education.
AIIB already has deployed $12 billion in India, of which $1.8 billion is in the private sector. It has a loan book of about $60 billion and is aiming to step this up.
'We will closely engage with government of India, the state governments and the private sector in India,' Pandey, who had previously served as India's finance secretary and as the chairperson of audit regulator National Financial Reporting Authority (NFRA), told reporters on the sidelines of an interaction with industry leaders organized by the Federation of Indian Chambers of Commerce and Industry (FICCI).
'We will work with all line-ministries to create a very sound pipeline of sovereign projects. Similarly, we will work with private sector players to create the pipeline of the projects where we can finance through all the options that are available".
Pandey explained that AIIB's message to the Central ministries and state governments is this, 'This is your bank and you must make optimum use of the resources available.'
'Yesterday we had a detailed meeting with the secretary, Department of Economic Affairs, and secretary, Department of Water Resources, River Development and Ganga Rejuvenation on the water sector, including revival of many dams, the Namami Gange project and the inter-linking of rivers. We are going to have discussions with the ministries of health and power and then with the Honourable chief minister Maharashtra and state officials to discuss building a pipeline of infrastructure projects both in public andprivatesector,' said Pandey.
Besides China and India, the other leading shareholders in the banks set up a decade ago are Russia, Germany and South Korea.
The multilateral bank with 110 member-nations is making a strong foray into development financing as emerging economies need to invest heavily for development, especially to transition to less-carbon intensive economies.
According to a Deloitte India report released earlier this month, titled 'The climate response: Tapping into India's climate and energy transition opportunity,'India would require a $1.5-trillion investment by 2030 across key areas to address the climate challenge at scale. The investments will be driven by India's efforts towards renewable energy, biofuels, decarbonization and sustainable infrastructure to combat climate change, the report said.
In 2021, India committed to achieving net zero emission by 2070.