NIIF in debut Indian infra investment

The sovereign infrastructure fund has teamed up with DP World to co-invest $3bn in the country’s logistics and transport assets.

Dubai-based logistics investor DP World and India’s National Infrastructure Investment Fund have created a joint platform to invest up to $3 billion of equity in India’s transport and logistics sectors.

The platform will pursue opportunities in sea ports, terminals, transportation and logistics sectors, while assets such river ports and transportation, freight corridors, port-led special economic zones, inland container terminals and cold storage will also be targeted.

“Efficient logistics and cargo movement are critical components for the continued growth and development of the Indian economy and particularly the manufacturing sector,” said Sujoy Bose, chief executive of the NIIF.

“This is NIIF’s first investment and is a good example of how NIIF can work with international capital and expertise to invest at scale to build critical infrastructure in India,” Bose added. He expects the platform to help reduce the cost of moving cargo between port and the destinations.

The sovereign infrastructure fund secured its first institutional commitment of $1 billion from the Abu Dhabi Investment Authority last October. It was established in July 2015 with an expected size of $6 billion. Half of the fund is sponsored by the Indian government, while fundraising for the remaining half continues to attract private capital to support domestic infrastructure development.

The creation of the investment vehicle follows a memorandum of understanding signed by the two parties in May last year. The agreement originally expected a $1 billion commitment by DP World to India’s logistics infrastructure ­­– expanding its existing $1.2 billion commitments. DP World is the only foreign port operator in India, holding a market share of about 30 percent.