Indian Government is planning to work with the UK by exploring the possibility of setting up a London-listed 'feeder fund' for Infrastructure Debt Funds ( IDFs) to increase institutional investments in the sector, said Finance Minister P Chidambaram.
In a Joint statement released here by Mr. Chidambaram and his British counterpart, George Osbourne they said, "Both countries agreed to pursue joint work on the common aim of exploring ways to encourage increased institutional investment in infrastructure."
After the 6th annual India-UK Economic and Financial Dialogue that ended here yesterday Chidambaram said, "They are exploring the possibility of establishment of a London listed 'feeder fund' for Indian Infrastructure Debt Funds (IDFs)."
"A feeder fund makes most of its investments through a 'master fund' and generally it can get better trading and operating costs through the master-feeder structure because of economies of scale."
The Joint statement said that India will actively consider the UK's offer of partnership over the Bengaluru-Mumbai Economic Corridor (BMEC), and co-financing of a feasibility study.
India has set a target of investing USD 1 trillion by 2017 to bolster its infrastructure. Besides infrastructure, a range of issues including financial sector reforms, the importance of increasing FDI in Indian insurance sector and support for SMEs with plans to "work together to promote trade and investment between the SME sectors of the two countries".
"We agreed on the importance of passing the Indian Insurance Amendment Bill in order to enhance the Foreign Direct Investment limit in insurance companies from 26 per cent to 49 per cent and enable international reinsurers to establish in India," the ministers said.
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