Speed Post News Network
New Delhi : A day long Joint India- NDB workshop on enhancing New Development Bank (NDB)’s engagement with the Indian private and public sector was held here on September 3, 2019.
The NDB is the first Multilateral Development Bank established by developing countries and emerging economies — Brazil, Russia, India, China and South Africa. The mandate of the Bank is to mobilise resources for infrastructure and sustainable development projects in BRICS and other emerging economies and developing countries, complementing the existing efforts of multilateral and regional financial institutions for global growth and development. India is one of the founding members holding 20% stake in the Bank. The Bank is headquartered in Shanghai.
As of now, NDB’s approved loan proportion to India is 28%, the second highest after China amongst the BRICS countries. States like Madhya Pradesh, Bihar, Rajasthan, Maharashtra, and Assam are receiving funding from the Bank. NDB is now keen on expanding its operation in other states and union territories in India. The Bank is also looking forward to expand its lending to private sector in India.
The workshop was co-organised by NDB and the Department of Economic Affairs (DEA), Ministry of Finance, Government of India. It was co-chaired by K Rajaraman, Additional Secretary, DEA, Xian Zhu, Vice President and Chief Operations Officer (COO) of NDB, and was attended by more than 100 representatives from Indian public and private sector including Ms Naina Lal Kidwai, Member of BRICS Business Council and Past President of FICCI.
Additional Secretary Rajaraman complimented NDB’s flexible business approach and quick turnaround for loan processing. He noted that India will require an investment of about USD 1.30 trillion in the infrastructure sector over the next five years, which will require innovative sources of funding, and that NDB can contribute towards meeting this funding requirement. He mentioned that NDB aims to provide local currency financing options in its member countries and expressed hope that NDB will be able to provide rupee financing in India soon. He encouraged infrastructure developers from both public and private sectors to explore funding opportunities from NDB to finance sustainable infrastructure projects such as urban water supply, solid waste management, smart cities, renewable energy, smart grid, etc.
Zhu gave an overview of NDB’s overall operations as well as its operations in India. He stated that the international credit rating of AA+ is a demonstration of the strong growth and financial strength of the Bank. He affirmed that NDB aims to support the Indian public and private sector for infrastructure development through innovative means such as loans in local currency, guarantees, credit enhancement and equity investments. He added that Indian companies can also participate as contractors in NDB funded projects and can participate in providing consulting services under the project technical assistance, according to a PIB release.
Ms Kidwai remarked that NDB can consider raising green bonds for financing water and sanitation projects and also provide credit enhancement to municipalities for raising bonds.