India's infrastructure development assisted by new London offices

11-Apr-2008

Indian Finance Minister opens new India Infrastructure Finance Company offices in London

India Infrastructure Finance Company Limited today announced that it has chosen London as the preferred location for its new overseas subsidiary, thanks to assistance by Think London, the foreign direct investment agency for London.

The new company, India Infrastructure Finance Company (UK) Limited (IIFC UK) will provide finance for infrastructure projects in India by lending foreign currency to the infrastructure companies in India and borrowing out of foreign exchange reserves from the Central Bank there.

India’s rapid economic growth of over 8% and increase of GDP in the past few years has resulted in the need for a significant increase in infrastructure investment in the country. According to the Planning Commission of India, over US $492 billion of funding is needed for new power stations, airports, roads, railways, seaports, airports, waterways and urban infrastructure over the next five years.

Speaking at the inauguration in London today, the Indian Finance Minister Mr Palaniappan Chidambaram, said: “The UK is India’s second largest trading partner and investment into London by Indian business continues to grow significantly each year. London’s broad range of world-class services make it an ideal destination for Indian businesses.”

Michael Charlton, Chief Executive, Think London said: “IIFC UK is a tremendous example of the continued investment by Indian companies into London’s economy. London’s status as the world’s financial capital and our well established Indian business community offers Indian companies looking to globalise their operations, the right connections and environment to achieve success.”

SS Kohli, Chairman, IIFCL said: “IIFC UK is ready to assist Indian companies looking to buy capital equipment in the UK in order to develop infrastructure in India.”

Many products, equipment and services needed for these projects are sourced overseas and IIFCL UK will provide the capital in foreign currency needed to help companies source capital equipment needed to create world class infrastructure in India. Think London estimates that Indian FDI accounted for 14% of all FDI projects into London during 2006/2007, up from 6% over the same period in 2000/2001.

Over the past four years, Think London has assisted 67 Indian companies to set up and expand in London, generating 1,867 jobs. Think London has recently assisted a number of notable Indian companies including Punjab National Bank International Limited (view Punjab National Bank client video here), Orchid Chemicals, HDFC, Wipro and Exilant Technologies. India is now the second largest contributor of FDI projects to London, according to Think London.