Mumbai: The Asian Infrastructure Investment Bank (AIIB) has approved an investment of $575 million in suburban railways and renewable energy sector, taking to its total commitment in India to nearly $3 billion.

It will extend a long-term project loan to Mumbai Urban Transport Corporation for $500 while the rest $75 million will be invested in Tata Cleantech Capital.

“Over the past four years, AIIB’s investments in India have grown exponentially,” said AIIB’s chief investment officer DJ Pandian in Mumbai, adding “it is a clear sign of our valuable partnership. AIIB will continue aligning its commitments with the government’s priorities, with the bank serving as a catalyst to India’s continued development.”

The loan from Asian Infrastructure Investment Bank is priced at 140 basis points more than the London Interbank Offered Rate with a tenor of 20-25 years, said Pandian.

AIIB has tied up with Mumbai Urban Transport Project, which is involved with developing the city’s infrastructure, including local trains, roads, etc. The dollar-denominated funds will contribute to a quadrupling of the Virar-Dahanu Road corridor (64 kms) which will provide an extension of the suburban railway service to connect with peripheral areas of Mumbai.

The project will also involve the construction of a new suburban railway tracks between Panvel and Karjat (28 kms) where there’s rapid urbanization and rising commuters.

The supranational institution can invest in Indian projects of up to $3-4 billion a year, which would be 30-40% of its total disposable approved sum.

Besides the latest announcement, AIIB has also invested in Assam’s power transmission and distribution projects.

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“We are looking for workable long-term projects where local banks could not participate due to inherent problems,” said Pandian.

Headquartered in Beijing, the multilateral development bank began operations in January 2016.AIIB has so far financed $2.9 billion in India, and contributed to 13 projects in the country since then.





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