Government-backed domestic infrastructure fund, National Investment & Infrastructure fund (NIIF), is seeking to raise a $2-billion private credit fund, India’s largest such vehicle.
NIIF has initiated discussions with sovereign investors for their participation in the fund, chief executive officer Sanjiv Aggarwal said at an Indian Venture and Alternate Capital Association event in Mumbai last week.
The quasi-sovereign fund oaims to invest the capital raised from international investors in the Indian economy and offer large co-investment opportunities to LPs, thus helping to crack large deals, he further added.
Anchored by the government of India and introduced during the union budget of 2015-16, the fund invests across Infrastructure and Growth Equity. It manages more than $4.4 billion assets under management through four funds, each with a different strategy: Master Fund, Private Markets Fund, Strategic Opportunities Fund, and India-Japan Fund.
While the master fund invests in businesses and assets across different core infrastructure sectors, the private markets fund offers an entry point to global investors in India’s private assets market through a mix of third party fund managers and co-investment opportunities.
The Strategic Opportunities Fund (SOF) is one of the largest India-focused growth equity funds and invests through both active minority stakes and control-oriented/incubation deals. The India-Japan fund is NIIF’s first bilateral fund with a partnership between the Government of India and Japan Bank for International Cooperation, to invest in India and collaborate with Japanese companies investing in the country in the sectors focused on environmental preservation.
NIIF’s international partners include sovereign wealth and pension funds like Canada’s Ontario Teachers’ Pension Plan, Australia’s AustralianSuper, the UAE’s Abu Dhabi Investment Authority (ADIA), and Singapore’s Temasek.
In October 2017, NIIF signed its first investment deal of $1 billion with the ADIA, while in December 2019, the Canada Pension Plan Investment Board agreed to invest $600 million in the fund.
Some of its domestic investors include HDFC Bank, Axis Bank, ICICI Bank, and Kotak Mahindra Life. In June 2018, the Asian Infrastructure Investment Bank announced its plan to invest $200 million in NIIF.
Private credit investments in the country reached $9.2 billion across 163 deals in 2024, driven by larger transactions and stronger domestic participation, according to an EY report.
