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India Ratings announces rating of 1st infrastructure debt fund

GoI expects IDFs to act as a medium for channelising much-needed long-term debt for financing infrastructure projects

May 14, 2013 3:36 IST | India Infoline News Service
India Ratings & Research (Ind-Ra) has announced its rating on the mutual fund (MF) schemes of the infrastructure debt fund (IDF)–Series 1, launched by IL&FS Financial Services Ltd (IFIN, ‘IND AAA’/Stable), a 100% subsidiary of  Infrastructure Leasing & Financial Services Ltd. (IL&FS, ‘IND AAA’/Stable), under the Securities and Exchange Board of India guidelines.

Dr Arvind Mayaram, Secretary, Department of Economic Affairs, in New Delhi today, released the ‘IND AAAidf-mf’ rating assigned by Ind-Ra to the initial three MF schemes of IL&FS IDF aggregating Rs.15bn. Dr Mayaram also released a special report: ‘Rating Mutual Fund Schemes of Infrastructure Debt Funds’, published by Ind-Ra, explaining its approach to rating MF schemes of IDFs. The event was attended, among others, by senior government officials, chairmen of banks and senior management of IL&FS, IFIN and Ind-Ra.

The Finance Minister in his budget speech for FY12 had announced setting up of IDFs to accelerate and enhance the flow of long-term debt into infrastructure projects for funding the government’s massive programme of infrastructure development, estimated at around $1 trillion during the 12th Five-Year Plan.

GoI expects IDFs to act as a medium for channelising much-needed long-term debt for financing infrastructure projects and also to help in the migration of project loans for operating assets from banks to the fixed income markets. GoI has actively facilitated the creation of a regulatory framework and establishment of an enabling environment.

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