National Investment and Infrastructure Fund (NIIF), a fund created by the Government of India for enhancing infrastructure financing in the country, is in talks with HDFC Capital to invest in a fund for the promotion of affordable housing.
NIIF on Sunday had announced an infusion of $200 million, in two tranches, from Asian Infrastructure Investment Bank (AIIB) into a fund of funds (FoF) that would be managed by the Indian entity, Sujoy Bose, CEO, NIIF, said. HDFC Capital is an arm of housing finance major Housing Development Finance Corp (HDFC) and is headed by Vipul Roongta. The current fund, HDFC Capital Affordable Real Estate Fund 2, will be of $600 million.
In addition to the HDFC Capital-promoted fund, NIIF also plans to invest in other funds that are in the green energy space, Bose said.
NIIF, through this entity, will anchor and invest in funds managed by other fund managers who have good track records in the sectors which are focus areas for the Indian government-sponsored arm, Bose said.
The areas include green infrastructure, mid-income & affordable housing, infrastructure services and allied sectors. Recently this fund of funds made its first investment in Green Growth Equity Fund that will invest in renewable energy, clean transportation, water, sanitation and waste management.
On its part, AIIB will provide the expertise to enhance NIIF’s environmental and social risk management capabilities to improve and monitor environmental and social performance across its portfolio of investments, a release from the multilateral agency said.