Saudi Arabia, India said to formalize $750m investment fund
Two countries agree to proceed with setting up the fund, Indian media report
Saudi Arabia and India have formalized the structuring of the $750-million Saudi-Indian Investment Fund that was announced during Prime Minister Manmohan Singh’s visit to Riyadh in 2010, according a report published in a section of the Indian media on Wednesday.
After the recent visit of Indian Finance Minister P Chidambaram to Riyadh in January this year, both sides finally agreed to proceed with the setting up of the fund and have decided to appoint nodal points in a time-bound manner, Hindustan Times quoted senior official sources as saying.
“Joint secretary (infra) in the department of economic affairs (DEA), Ministry of Finance will be the nodal point from the Indian side and director general, Public Investment Fund, will be the nodal point from the Saudi side,” officials said.
Saudi Arabia is India’s fourth-largest trading partner at $43.78 billion in 2012-13. During April-November 2013-14, the two-way trade was $32.7 billion. India’s imports of crude form a major part of this trade with almost one-fifth of the country’s oil imports coming from Saudi Arabia.
Besides Saudi Arabia, other Gulf nations including Kuwait, Abu Dhabi and several other sovereign wealth funds (SWFs) from across the globe including Japan, UAE, Norway, Canada among others have also shown interest in investing in India’s infrastructure projects including the Delhi Mumbai Industrial Corridor, power projects, toll bridges, civil aviation and oil and gas projects.
The infrastructure sector requires an estimated $1 trillion in investments over the next four-five years.
Leading SWFs have also expressed interests in investing in government bonds floated specifically for funding infrastructure projects, officials said. “India is preferred as one of the top three investment destinations amongst the emerging economies of Brazil, China and India. Returns on infrastructure in India are among the highest in the world,” the sources told HT.
This article was first published in the Saudi Gazette on March 20, 2014.