National Investment and Infrastructure Fund (NIIF)

What is it?

• National Investment and Infrastructure Fund (NIIF) is India’s first sovereign wealth fund.
• It is anchored by the Government of India(GoI) in collaboration with leading global and domestic institutional investors.
• The objective is to maximize economic impact mainly through infrastructure investment in commercially viable projects, both Greenfield and Brownfield.

Working:

• NIIF has about USD 4 billion commitment across three funds, from Government of India along with commitments from other institutional investors.
• It intends to be a key channel of investment into Indian infrastructure with a focus on transportation (roads, ports and airports), energy, urban planning and other infrastructure and allied segments.
• NIIF is also engaged in fund raising through suitable instruments including off-shore credit enhanced bonds, and attracting anchor investors to participate as partners in NIIF.

Funds under NIIF:

• NIIF currently manages three funds registered as Alternative Investment Fund(AIF) with the Securities and Exchange Board of India (SEBI).
  • Master Fund-For primarily investing in core infrastructure sectors such as roads, ports, airports, power etc.
  • Fund of Funds-To invest in funds managed by fund managers who have good track records in infrastructure and associated sectors in India.
  • Strategic Opportunities Fund-For investing in strategic assets and projects that are likely to benefit India’s growth trajectory over the medium to long-term.

What are Alternative Investment Funds (AIFs)?

• Alternative Investment Funds refers to any privately pooled investment fund, (whether from Indian or foreign sources), in the form of a trust or a company or a body corporate or a Limited Liability Partnership (LLP).
• They are regulated by the SEBI (Alternative Investment Fund) Regulations 2012.

What is a Sovereign Wealth Fund?

• A sovereign wealth fund (SWF) is an investment fund that is owned and operated by the state with a purpose to protect or boost the national economy.

PRELIMS QUESTION

Consider the following statements regarding “National Investment and Infrastructure Fund (NIIF)”
1.It is India’s first sovereign Wealth Fund.
2.It will invest in both greenfield and brownfield projects.
Which of the statements given above is/are correct?
(a)1 only
(b)2 only
(c)Both 1 and 2
(d)Neither 1 nor 2

Answer to prelims question