SK Goel, Chairman of India Infrastructure Finance Company (IIFCL) informed that the firm was working towards launching a regular credit enhancement scheme from April.
According to the scheme, the financial institution would provide partial guarantee to bonds issued by infrastructure firms and this would improve the credit rating of these bonds. The improved credit rating would enable insurance companies and pension funds to subscribe to these bonds.
Through this scheme, projects from various sectors such as sea port, wind energy, fertiliser (one project each), power transmission (two projects), and roads (seven projects) stand to benefit.
As part of its Rs 5,000-crore credit enhancement initiative, IIFCL will provide partial guarantee to bonds issued by 15 infrastructure firms, including GMR, GVK, Larsen and Toubro and Gammon.
In January, IIFCL had launched its credit enhancement initiative with the support of Asian Development Bank by signing the IIFCL Guarantee with GMR Jadcherla Expressways.
Around 15 projects with a total size of Rs 20,000 crore are being considered. All projects are in public private partnership mode.
IIFCL has also submitted a detailed scheme to the government and it expects that regular credit enhancement scheme may find a mention in the Budget.