Asian Infrastructure Investment Bank(AIIB)

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26-Oct-2022: Union Finance Minister Smt. Nirmala Sitharaman attends the 7th Annual Meeting of Board of Governors of Asian Infrastructure Investment Bank through video conference today

Union Minister of Finance & Corporate Affairs Smt. Nirmala Sitharaman attended the 7th Annual Meeting of the Board of Governors of Asian Infrastructure Investment Bank (AIIB) via video conference from New Delhi today.

Every year at the Annual Meeting, the Board of Governors meets to take key decisions on important matters relating to AIIB, and its future vision. India is a Founding Member and the second largest shareholder in AIIB. India also has the largest project portfolio within AIIB. The theme of this year’s Annual Meeting was “Sustainable Infrastructure Toward a Connected World”.

The Finance Minister shared her thoughts in the Governor’s Roundtable Discussion on the theme “Financing Infrastructure in a Crisis-Prone World”. In her intervention, the Finance Minister appreciated AIIB for its continued commitment and dedication to assist members and for providing high-quality development finance. Smt. Sitharaman stated that, despite exogenous threats, India’s well-targeted policy mix, accompanied by major structural reforms and sound external balance sheet, have aided its growth to remain resilient. The Finance Minister emphasized that India has embarked on the path of a self-reliant economy and therefore has been successful in mitigating the negative effects of the pandemic. Smt. Sitharaman underscored the remarkable progress India has made through its Digitalization Mission, utilizing technology to facilitate social protection and boost financial inclusion. The Finance Minister also highlighted that Prime Minister Shri Narendra Modi is actively leading India’s climate change response efforts through various programs such as ‘Lifestyle for Environment’ (or LiFE), among many others.

The Finance Minister suggested that in order to ensure meaningful impact is achieved and resources are not scattered in multiple areas, AIIB needs to scale-up investments in key priority areas including clean energy and energy efficiency, disaster resilient infrastructure, social infrastructure with a special focus on education and health, and digital infrastructure.

As public resources alone are insufficient to meet vast infrastructure needs of members, the Finance Minister advised that the Bank should not only play a catalytic role in mobilizing diverse private sector resources but also explore mechanisms to augment its own resources, including through early action on the recommendations of G20’s Expert Panel’s Report on the MDB’s Capital Adequacy Framework (CAF).

Moreover, the Finance Minister pointed out that beyond its financial support, AIIB should work towards expanding the scope of its mid-stream and upstream engagement activities such as increased technical assistance to help clients translate strategies into investment plans. Finally, Smt. Sitharaman suggested that the Bank should set-up full-fledged country offices in member locations.

In conclusion, the Finance Minister assured AIIB of India’s continued collaboration in achieving its mandated mission.

26-Oct-2021: Finance Minister Smt. Nirmala Sitharaman participates in 6th Annual Meeting of Board of Governors of Asian Infrastructure Investment Bank

Union Minister of Finance & Corporate Affairs Smt. Nirmala Sitharaman participated in the 6th Annual Meeting of the Board of Governors of Asian Infrastructure Investment Bank (AIIB) via video conference from New Delhi today.

Every year at the Annual Meeting, the Board of Governors meets to take key decisions on important matters relating to AIIB, and its future vision. India is a Founding Member and the second largest shareholder in AIIB. India also has one of the largest project portfolios within AIIB. This year’s Annual Meeting has been jointly organized by AIIB and the Government of United Arab Emirates on the theme of “Investing Today and Transforming Tomorrow”.

The Finance Minister shared her thoughts in the Governor’s Roundtable Discussion on the theme “COVID-19 Crisis and Post-COVID Support”. In her intervention, Smt. Sitharaman appreciated AIIB’s prompt actions in providing financial support to Member Countries, including India, in their efforts to contain and combat COVID-19. The Finance Minister stated that the social protection and economic stimulus packages brought out by the Government of India, along with timely structural reforms in various sectors, have been pivotal in India’s economic recovery process. The stimulus packages, including the credit guarantee scheme for micro finance institutions, boosters for project exports through National Export Insurance Account, additional subsidies for fertilizers, free food grains for 800 million people under the Pradhan Mantri Garib Kalyan Yojana, and several welfare schemes with a strong public health focus, helped to effectively and efficiently boost the economy and protect lives and livelihoods, especially of the poor and vulnerable.

Smt. Sitharaman emphasised Government of India’s successful drive to rapidly vaccinate its citizens, administering over 1 billion vaccines – a milestone achieved with the help of the strong scientific and technological ecosystem in India. The Finance Minister also highlighted India’s “Vaccine Maitri” initiative, a global health outreach, under which 70 million doses of the ‘Made in India’ COVID-19 vaccines have been supplied to 95 countries and UN entities, including nearly 20 million doses to 47 countries under the COVAX facility and more than 12 million vaccine doses as grant to 47 countries and UN peacekeepers.

Smt. Sitharaman pointed out that the current crisis and the looming climate crisis have reinforced the importance of Multilateral Development Banks (MDBs) and the urgency for supplementing country efforts with multilateral development finance. In this context, she highlighted some of the expectations from the Bank, including the need to explore investment opportunities in the creation and development of assets in social infrastructure sectors; to further intensify private sector capital mobilisation for inclusive and green development; and to set up a Resident Board and Regional Offices to ensure accountability, transparency and quality of operations and investments.

Smt. Sitharaman assured India’s cooperation and support to the AIIB for its future endeavours as a leading financial institution.

23-Feb-2021: Government of India & AIIB sign agreement for $304 million to improve reliability, capacity and security of the power transmission network in the state of Assam

The Government of India and the Asian Infrastructure Investment Bank (AIIB) today signed a loan agreement for a $304 million Assam Intra-State Transmission System Enhancement Project to improve reliability, capacity and security of the power transmission network in the State of Assam.

The project aims to strengthen Assam’s electricity transmission system by

  1. constructing 10 transmission substations and laying transmission lines with the associated infrastructure;
  2. upgrading 15 existing substations, transmission lines and existing ground wire to optical power ground wire; and
  3. providing technical assistance to support project implementation.

The programme would strengthen the existing intrastate transmission network of Assam by augmenting it with newer networks to achieve affordable, secure, efficient and reliable 24×7 power. This would, in turn, bring Assam closer to ensuring long-term sustainability of its electricity supply.

The loan agreement was signed by Shri Baldeo Purushartha, Joint Secretary, Department of Economic Affairs, Ministry of Finance on behalf of the Government of India, and Shri Rajat Misra, Acting Director General, Investment Operations on behalf of the AIIB.

Shri Purushartha said that the project is expected to improve the transmission network and reduce transmission losses. The strong backward and forward linkages associated with the project will create socio-economic opportunities for both households and business communities in the State. Shri Purushartha added that this project financing will help achieving the AIIB energy sector mandate and also support Government of India in fulfilling the national development priorities.

The State of Assam currently witnesses substantial energy and peak demand deficits. One of the main reasons for the power-deficit scenario in Assam is congestion of the electricity distribution and transmission networks. Assam Electricity Grid Corporation Limited (AEGCL), the sole transmission utility in Assam is responsible for the operation, maintenance and development of the transmission system in the State. AEGCL currently operates 66 substations with 6,882 megavolt-ampere capacity, and its transmission network comprises 5,701 circuit kilometers of transmission lines.  The project would improve the transmission network constraints and congestion in the state.

Shri D.J. Pandian, vice-president, AIIB, said that the AIIB’s investment will improve the reliability, capacity and security of the power transmission network in Assam. The project will also help in reducing greenhouse gas emissions and improve the quality of power supply to the ultimate consumers.

The total estimated cost of the project is $365 million, of which $304 million will be financed by the AIIB while the counterpart funding from the Government of Assam is $61 million. The $304 million loan from the AIIB has a 5-year grace period and a maturity of 24 years.

24-Aug-2020: Government of India and AIIB sign agreement for $500 million to improve the network capacity, service quality and safety of the suburban railway system in Mumbai

The Government of India, the Government of Maharashtra, Mumbai Railway Vikas Corporation and the Asian Infrastructure Investment Bank (AIIB) today signed a loan agreement for a $500 million Mumbai Urban Transport Project-III to improve the network capacity, service quality and safety of the suburban railway system in Mumbai.

The Project is expected to increase network capacity in the region with the reduction in journey time and fatal accidents of commuters. It is estimated that among primary beneficiaries of the project, 22% are female passengers who will benefit from improved safety and quality of service.

The loan agreement was signed by Shri Sameer Kumar Khare, Additional Secretary, Department of Economic Affairs, Ministry of Finance, on behalf of the Government of India, Shri Sanjay Kumar, Chief Secretary on behalf of the Government of Maharashtra, Shri R. S. Khurana, Chief Managing Director on behalf of the Mumbai Rail Vikas Corporation and Shri Rajat Misra, Director General (Acting), Investment Operations on behalf of the AIIB.

Shri Khare said that this project will assist in improved mobility, service quality and safety of passengers of the sub urban railway system of Mumbai, by providing faster, more reliable and higher quality transport services compared to road-based transport. There will be direct safety benefits to passengers and the public through introduction of trespass control measures.

With a population of 22.8 million (2011), Mumbai Metropolitan Region (MMR) is the most populous metropolitan region in India and is expected to reach 29.3 million by 2031 and 32.1 million by 2041. This population growth represents the core driver behind Mumbai’s urban expansion, compelling the state of Maharashtra to prioritize sound urban and infrastructure planning which balances economic activities, mobility as well as the optimization of environmental and social outcomes.

Around 86 per cent of Mumbai commuters rely on public transport. However, supply has not kept pace with rising travel demand. The Mumbai suburban railway network, which carries three quarters of all motorized travel (78 per cent of passenger km or eight million passengers per day) increasing at three per cent annually, suffers from some of the most severe overcrowding in the world. User experience is further compromised by low amenity of carriages, substandard stations and station access, and serious safety concerns. Between 2002-2012, there were more than 36,152 fatalities (on average, 9.9 fatalities per day) and 36,688 injuries on the Mumbai suburban railway network. A key reason for accidents and deaths is trespassing at or between stations as well as overcrowding of both stations and train cars.

AIIB Vice President D.J. Pandian said that this project represents another major step in supporting our member countries in their efforts to provide transport capacity while removing transport bottlenecks, and thus improving the daily commuting experience of millions of Mumbaikars. In line with our Transport Sector Strategy, the Mumbai Urban Transport Project-III will also help in reducing carbon emissions by shifting passengers away from higher-carbon road transport towards efficient and convenient rail-based mobility. In addition, female passengers will benefit from improved safety and quality of service.

The total estimated cost of the project is $997 million, of which $500 million will be financed by the AIIB, $310 million by the Government of Maharashtra and $187 million by Ministry of Railways. The $500 million loan from the AIIB has a 5-year grace period and a maturity of 30 years.

28-Jul-2020: Finance Minister Smt. Nirmala Sitharaman attends the 5th Annual Meeting of Board of Governors of Asian Infrastructure Investment Bank

Union Minister of Finance & Corporate Affairs Smt. Nirmala Sitharaman attended the 5th Annual Meeting of the Board of Governors of Asian Infrastructure Investment Bank (AIIB) through video conference in New Delhi today.

Every year at the Annual Meeting, the Board of Governors meet to take key decisions that impact the Bank’s future. The discussions at the meeting broadly covered official business including election of the President of the AIIB and a roundtable discussion on the theme ‘AIIB 2030-Supporting Asia’s Development over the Next Decade’.

Smt. Sitharaman was identified as a Lead Speaker at the roundtable discussion. In her intervention, Smt. Sitharaman appreciated AIIB’s efforts for fast tracking financial assistance of about $10 Billion to its member countries including India to combat COVID-19 pandemic. Smt. Sitharaman mentioned about Prime Minister Shri Narendra Modi’s initiative of creating a COVID-19 Emergency Fund for SAARC Nations and India’s efforts in supplying critical medical health kits to tackle the COVID-19, and now supporting global efforts of COVID-19 vaccine trials. Besides, the Finance Minister highlighted India’s participation in the “G20 Debt Service Suspension Initiative”.

Smt. Sitharaman also outlined various measures taken by the Government of India to respond to the COVID-19, including the $23 Billion Pradhan Mantri Garib Kalyan Yojana (PMGKP) and $295 Billion Aatma Nirbhar Bharat Package (ANBP), which aim at protecting all sectors and sections of the economy. The Reserve Bank of India eased the monetary policy especially reduced reserve requirements and introduced liquidity in the economy to the extent of almost 3.9% of GDP.

The Finance Minister mentioned that to give a boost to the infrastructure development, India has launched the National Infrastructure Pipeline (NIP) 2020-2025 with estimated expenditure of $1.4 trillion that has created a plethora of fresh investment opportunities for AIIB’s partnerships. Furthermore, she mentioned some of the expectations from the Bank, including introduction of new financing instruments, mobilising private sector finance, providing financing for social infrastructure to achieve the SDGs 2030, and integrating development of climate resilient and sustainable energy access infrastructure into the recovery response to the COVID-19 crisis. Smt. Sitharaman also suggested the Bank to establish Regional Presence which would aid in effective project management and implementation.

The Finance Minister commended the AIIB management for the very healthy growth that the Bank has achieved in a short span of five years and wished success to the Bank’s future endeavours.

17-Jun-2020: AIIB Approves USD750-M Loan to India for COVID-19 Response

The Asian Infrastructure Investment Bank (AIIB) has approved a USD750-million loan to India to assist the government to strengthen its response to the adverse impacts of the COVID-19 pandemic on millions of poor and vulnerable households.

Co-financed with the Asian Development Bank, the budgetary support will go toward bolstering economic aid for businesses, including for the informal sector, expanding social safety nets for the needy, and strengthening the country’s health care systems.

India is extremely vulnerable to the pandemic given that around 270 million people continue to live below the national poverty line and around 81 million live in densely populated informal settlements with limited access to health services, according to the World Bank. The disruption in economic activities threatens to impact poor households disproportionately, especially women, many of whom are in employed in the informal sector.

“Many of the world’s low and middle-income countries are still in the early stages of the health crisis but are already feeling the impacts of the pandemic. This poses an enormous risk for millions across India who have only recently emerged from poverty,” said AIIB Vice President, Investment Operations, D.J. Pandian.

The International Monetary Fund has revised its 2021 GDP forecast for the country to 1.9 percent, which is about 3.9 percent lower than its January 2020 forecast.

Pandian added, “Our support to India also aims to ensure economic resilience to prevent long-term damage to the productive capacity, including human capital, of India’s economy.”

AIIB’s total sovereign loans to India that have already been approved amount to USD3.06 billion, including a recent USD500 million COVID-19 emergency response. The current loan will be the second for India under AIIB’s COVID-19 Crisis Recovery Facility (CRF), which was created as part of the coordinated international response to counter the pandemic, to support AIIB members’ urgent economic, financial, and public health needs and quick recovery from the crisis.

While AIIB does not have a regular instrument for policy-based financing, the Bank is extending such financings on an exceptional basis under the CRF to support its members through projects co0financed with the World Bank or the Asian Development Bank.

AIIB is currently reviewing projects from its members. Projects being proposed under the CRF can be found here. Additional information about the India COVID-19 Active Response and Expenditure Support Program can be found here.

About AIIB: The Asian Infrastructure Investment Bank (AIIB) is a multilateral development bank with a mission to improve social and economic outcomes in Asia. Headquartered in Beijing, we began operations in January 2016 and have now grown to 102 approved members worldwide. By investing in sustainable infrastructure and other productive sectors in Asia and beyond, we will better connect people, services and markets that over time will impact the lives of billions and build a better future.

8-May-2020: Government of India & AIIB sign agreement for $500 million COVID-19 support for India

The Government of India and the Asian Infrastructure Investment Bank (AIIB) signed a US$ 500 million “COVID-19 Emergency Response and Health Systems Preparedness Project” to help India to respond to the COVID-19 pandemic and strengthen its public health preparedness. This is the first ever health sector support from the Bank to India.

This new support will cover all States and Union Territories across India and address the needs of infected people, at-risk populations, medical and emergency personnel and service providers, medical and testing facilities, and national and animal health agencies.

The agreement was signed by Shri Sameer Kumar Khare, Additional Secretary, Department of Economic Affairs, Ministry of Finance, on behalf of the Government of India and Mr. Rajat Misra, Director General (Acting) on behalf of the AIIB.

Shri Khare said that AIIB’s timely assistance will help Government in its efforts to respond to the threat posed by COVID-19 and strengthen the national health systems for preparedness in India. Responding to the urgency of the pandemic, this project was prepared in record time, underlying the efforts of the officials from the Finance and Health Ministries and the AIIB.

The project will enable the Government of India to slow and limit as much as possible the spread of COVID-19 in India by providing immediate support to enhance disease detection capacities by scaling up procurement of PPE, oxygen delivery systems, and medicines, build resilient health systems to provide core public health, prevention, and patient management functions to manage COVID-19 and future disease outbreaks, support research on COVID-19 by Indian and other global institutions working in collaboration with the Indian Council of Medical Research, address significant negative externalities expected in the event of a widespread COVID-19 outbreak and strengthen public structures for the coordination and management of the project.

The primary project beneficiaries will be infected people, at-risk populations, medical and emergency personnel, service providers at medical and testing facilities (both public and private), and public and animal health agencies engaged in India’s COVID-19 response.

Mr D.J. Pandian, AIIB vice-president (Investment Operations), said that building a resilient health system that can effectively treat COVID-19 patients and prevent its spread is the immediate priority. This funding will address this need and strengthen India’s capacity to effectively manage future disease outbreaks.

He further said that facing this unprecedented global challenge, AIIB will play its part and work closely with international financial institutions to help the Government of India with urgent financing they need to shore up their healthcare systems and help their economies recover as quickly as possible.

The project will also enhance the resilience of India’s health system to provide core public health prevention and patient care to better manage COVID-19 and future disease outbreaks. It will help strengthen India’s Integrated Disease Surveillance Program, revamp infectious disease hospitals, district, civil, general and medical college hospitals, and build a network of high containment Biosafety Level 3 laboratories.

Today, about 75 per cent of new infectious diseases begin with human-to-animal contact, including HIV/AIDS, Ebola, and SARS. The project will develop capacity and systems to detect existing and emerging zoonoses, support biomedical research on COVID-19 by Indian institutions, and upgrade viral research and diagnostic laboratories for testing and research.

It will also help address potential significant negative externalities in the event of a widespread COVID-19 outbreak, including comprehensive health awareness and behaviour change campaigns on hygiene practices, wearing masks, social distancing, and mental health and psychological services for vulnerable communities.

The project is being financed by the World Bank and AIIB in the amount of $1.5 billion, of which $1.0 billion will be provided by World Bank and $500 million will be provided by AIIB.

The project will be implemented by the National Health Mission (NHM), the National Center for Disease Control (NCDC) and the Indian Council of Medical Research (ICMR) under the Ministry of Health and Family Welfare.

27-Feb-2018: AIIB approves $1.5 billion in loans to India for infrastructure projects

Asian Infrastructure Investment Bank (AIIB) has approved $1.5 billion in loans to India for infrastructure-related projects in 2018.

China plans to invest more than $100 billion through its Belt and Road scheme to build highways, rail lines, ports and other infrastructure linking Asia, Europe and Africa.

The funds would be used for investment in India’s energy, roads and urban development projects, and the bank will examine allotting more funds for such projects next year.

AIIB’s loans include a $200 million commitment to India’s National Investment and Infrastructure Fund to spend on roads, housing and urban development, and the bank will let the Indian government decide how to use that money. Energy-related projects will primarily be focused on renewables.

China-backed lenders are taking a more hands-off approach to overseas development financing, unlike western banks whose financing often comes with social and environmental strings and strengthens the voice of non-profits.

AIIB wants to encourage the transition to renewable energy but is not against investments in coal-related projects, unlike most of its peers who have campaigned against further investments in coal.

Any foreign investment in renewables is crucial for India, which needs at least $125 billion in investments to complete its ambitious target of adding 175 GW in clean energy by the end of 2022.

7-Jan-2018: AIIB plans to issue first US dollar bonds in June 2018

AIIB plans to issue its first US dollar-denominated bond with minimum worth of a USD billion by June this year. With 84 members so far, the AIIB was officially established in December 2015 and opened for business in January 2016.

The Beijing-based AIIB is a multilateral development bank initiated by China. The bank has an authorised capital of USD 100 billion.

The earliest issuance window will be "toward the end of the first half of 2018," with time required for certain procedures, including the Board of Governors' approval of AIIB's 2017 financial statements as well as borrowing and swap documentation.

The minimum size of the issuance will be one billion dollars, but as demand for the first bond issue from a triple-A multilateral institution in 25 years may be large. In terms of maturity of the bond, the choice will be between three and five years depending on investor demand at the time.

The bank plans to cap its total borrowing volume at USD three billion dollars in 2018.

The AIIB has received three top-notch ratings from the global credit rating agencies S&P Global Ratings, Moody's and Fitch in recognition of the bank's strong capital base and stable outlook.

China is the largest shareholder with 26.06 per cent voting shares in the bank. India is the second largest shareholder with 7.5 per cent followed by Russia 5.93 per cent and Germany with 4.5 per cent

It prioritises investment in energy, power generation, transport, rural infrastructure, environmental protection and logistics in Asia.

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26-Oct-2022: Union Finance Minister Smt. Nirmala Sitharaman attends the 7th Annual Meeting of Board of Governors of Asian Infrastructure Investment Bank through video conference today

Union Minister of Finance & Corporate Affairs Smt. Nirmala Sitharaman attended the 7th Annual Meeting of the Board of Governors of Asian Infrastructure Investment Bank (AIIB) via video conference from New Delhi today.

Every year at the Annual Meeting, the Board of Governors meets to take key decisions on important matters relating to AIIB, and its future vision. India is a Founding Member and the second largest shareholder in AIIB. India also has the largest project portfolio within AIIB. The theme of this year’s Annual Meeting was “Sustainable Infrastructure Toward a Connected World”.

The Finance Minister shared her thoughts in the Governor’s Roundtable Discussion on the theme “Financing Infrastructure in a Crisis-Prone World”. In her intervention, the Finance Minister appreciated AIIB for its continued commitment and dedication to assist members and for providing high-quality development finance. Smt. Sitharaman stated that, despite exogenous threats, India’s well-targeted policy mix, accompanied by major structural reforms and sound external balance sheet, have aided its growth to remain resilient. The Finance Minister emphasized that India has embarked on the path of a self-reliant economy and therefore has been successful in mitigating the negative effects of the pandemic. Smt. Sitharaman underscored the remarkable progress India has made through its Digitalization Mission, utilizing technology to facilitate social protection and boost financial inclusion. The Finance Minister also highlighted that Prime Minister Shri Narendra Modi is actively leading India’s climate change response efforts through various programs such as ‘Lifestyle for Environment’ (or LiFE), among many others.

The Finance Minister suggested that in order to ensure meaningful impact is achieved and resources are not scattered in multiple areas, AIIB needs to scale-up investments in key priority areas including clean energy and energy efficiency, disaster resilient infrastructure, social infrastructure with a special focus on education and health, and digital infrastructure.

As public resources alone are insufficient to meet vast infrastructure needs of members, the Finance Minister advised that the Bank should not only play a catalytic role in mobilizing diverse private sector resources but also explore mechanisms to augment its own resources, including through early action on the recommendations of G20’s Expert Panel’s Report on the MDB’s Capital Adequacy Framework (CAF).

Moreover, the Finance Minister pointed out that beyond its financial support, AIIB should work towards expanding the scope of its mid-stream and upstream engagement activities such as increased technical assistance to help clients translate strategies into investment plans. Finally, Smt. Sitharaman suggested that the Bank should set-up full-fledged country offices in member locations.

In conclusion, the Finance Minister assured AIIB of India’s continued collaboration in achieving its mandated mission.

26-Oct-2021: Finance Minister Smt. Nirmala Sitharaman participates in 6th Annual Meeting of Board of Governors of Asian Infrastructure Investment Bank

Union Minister of Finance & Corporate Affairs Smt. Nirmala Sitharaman participated in the 6th Annual Meeting of the Board of Governors of Asian Infrastructure Investment Bank (AIIB) via video conference from New Delhi today.

Every year at the Annual Meeting, the Board of Governors meets to take key decisions on important matters relating to AIIB, and its future vision. India is a Founding Member and the second largest shareholder in AIIB. India also has one of the largest project portfolios within AIIB. This year’s Annual Meeting has been jointly organized by AIIB and the Government of United Arab Emirates on the theme of “Investing Today and Transforming Tomorrow”.

The Finance Minister shared her thoughts in the Governor’s Roundtable Discussion on the theme “COVID-19 Crisis and Post-COVID Support”. In her intervention, Smt. Sitharaman appreciated AIIB’s prompt actions in providing financial support to Member Countries, including India, in their efforts to contain and combat COVID-19. The Finance Minister stated that the social protection and economic stimulus packages brought out by the Government of India, along with timely structural reforms in various sectors, have been pivotal in India’s economic recovery process. The stimulus packages, including the credit guarantee scheme for micro finance institutions, boosters for project exports through National Export Insurance Account, additional subsidies for fertilizers, free food grains for 800 million people under the Pradhan Mantri Garib Kalyan Yojana, and several welfare schemes with a strong public health focus, helped to effectively and efficiently boost the economy and protect lives and livelihoods, especially of the poor and vulnerable.

Smt. Sitharaman emphasised Government of India’s successful drive to rapidly vaccinate its citizens, administering over 1 billion vaccines – a milestone achieved with the help of the strong scientific and technological ecosystem in India. The Finance Minister also highlighted India’s “Vaccine Maitri” initiative, a global health outreach, under which 70 million doses of the ‘Made in India’ COVID-19 vaccines have been supplied to 95 countries and UN entities, including nearly 20 million doses to 47 countries under the COVAX facility and more than 12 million vaccine doses as grant to 47 countries and UN peacekeepers.

Smt. Sitharaman pointed out that the current crisis and the looming climate crisis have reinforced the importance of Multilateral Development Banks (MDBs) and the urgency for supplementing country efforts with multilateral development finance. In this context, she highlighted some of the expectations from the Bank, including the need to explore investment opportunities in the creation and development of assets in social infrastructure sectors; to further intensify private sector capital mobilisation for inclusive and green development; and to set up a Resident Board and Regional Offices to ensure accountability, transparency and quality of operations and investments.

Smt. Sitharaman assured India’s cooperation and support to the AIIB for its future endeavours as a leading financial institution.

23-Feb-2021: Government of India & AIIB sign agreement for $304 million to improve reliability, capacity and security of the power transmission network in the state of Assam

The Government of India and the Asian Infrastructure Investment Bank (AIIB) today signed a loan agreement for a $304 million Assam Intra-State Transmission System Enhancement Project to improve reliability, capacity and security of the power transmission network in the State of Assam.

The project aims to strengthen Assam’s electricity transmission system by

  1. constructing 10 transmission substations and laying transmission lines with the associated infrastructure;
  2. upgrading 15 existing substations, transmission lines and existing ground wire to optical power ground wire; and
  3. providing technical assistance to support project implementation.

The programme would strengthen the existing intrastate transmission network of Assam by augmenting it with newer networks to achieve affordable, secure, efficient and reliable 24×7 power. This would, in turn, bring Assam closer to ensuring long-term sustainability of its electricity supply.

The loan agreement was signed by Shri Baldeo Purushartha, Joint Secretary, Department of Economic Affairs, Ministry of Finance on behalf of the Government of India, and Shri Rajat Misra, Acting Director General, Investment Operations on behalf of the AIIB.

Shri Purushartha said that the project is expected to improve the transmission network and reduce transmission losses. The strong backward and forward linkages associated with the project will create socio-economic opportunities for both households and business communities in the State. Shri Purushartha added that this project financing will help achieving the AIIB energy sector mandate and also support Government of India in fulfilling the national development priorities.

The State of Assam currently witnesses substantial energy and peak demand deficits. One of the main reasons for the power-deficit scenario in Assam is congestion of the electricity distribution and transmission networks. Assam Electricity Grid Corporation Limited (AEGCL), the sole transmission utility in Assam is responsible for the operation, maintenance and development of the transmission system in the State. AEGCL currently operates 66 substations with 6,882 megavolt-ampere capacity, and its transmission network comprises 5,701 circuit kilometers of transmission lines.  The project would improve the transmission network constraints and congestion in the state.

Shri D.J. Pandian, vice-president, AIIB, said that the AIIB’s investment will improve the reliability, capacity and security of the power transmission network in Assam. The project will also help in reducing greenhouse gas emissions and improve the quality of power supply to the ultimate consumers.

The total estimated cost of the project is $365 million, of which $304 million will be financed by the AIIB while the counterpart funding from the Government of Assam is $61 million. The $304 million loan from the AIIB has a 5-year grace period and a maturity of 24 years.

24-Aug-2020: Government of India and AIIB sign agreement for $500 million to improve the network capacity, service quality and safety of the suburban railway system in Mumbai

The Government of India, the Government of Maharashtra, Mumbai Railway Vikas Corporation and the Asian Infrastructure Investment Bank (AIIB) today signed a loan agreement for a $500 million Mumbai Urban Transport Project-III to improve the network capacity, service quality and safety of the suburban railway system in Mumbai.

The Project is expected to increase network capacity in the region with the reduction in journey time and fatal accidents of commuters. It is estimated that among primary beneficiaries of the project, 22% are female passengers who will benefit from improved safety and quality of service.

The loan agreement was signed by Shri Sameer Kumar Khare, Additional Secretary, Department of Economic Affairs, Ministry of Finance, on behalf of the Government of India, Shri Sanjay Kumar, Chief Secretary on behalf of the Government of Maharashtra, Shri R. S. Khurana, Chief Managing Director on behalf of the Mumbai Rail Vikas Corporation and Shri Rajat Misra, Director General (Acting), Investment Operations on behalf of the AIIB.

Shri Khare said that this project will assist in improved mobility, service quality and safety of passengers of the sub urban railway system of Mumbai, by providing faster, more reliable and higher quality transport services compared to road-based transport. There will be direct safety benefits to passengers and the public through introduction of trespass control measures.

With a population of 22.8 million (2011), Mumbai Metropolitan Region (MMR) is the most populous metropolitan region in India and is expected to reach 29.3 million by 2031 and 32.1 million by 2041. This population growth represents the core driver behind Mumbai’s urban expansion, compelling the state of Maharashtra to prioritize sound urban and infrastructure planning which balances economic activities, mobility as well as the optimization of environmental and social outcomes.

Around 86 per cent of Mumbai commuters rely on public transport. However, supply has not kept pace with rising travel demand. The Mumbai suburban railway network, which carries three quarters of all motorized travel (78 per cent of passenger km or eight million passengers per day) increasing at three per cent annually, suffers from some of the most severe overcrowding in the world. User experience is further compromised by low amenity of carriages, substandard stations and station access, and serious safety concerns. Between 2002-2012, there were more than 36,152 fatalities (on average, 9.9 fatalities per day) and 36,688 injuries on the Mumbai suburban railway network. A key reason for accidents and deaths is trespassing at or between stations as well as overcrowding of both stations and train cars.

AIIB Vice President D.J. Pandian said that this project represents another major step in supporting our member countries in their efforts to provide transport capacity while removing transport bottlenecks, and thus improving the daily commuting experience of millions of Mumbaikars. In line with our Transport Sector Strategy, the Mumbai Urban Transport Project-III will also help in reducing carbon emissions by shifting passengers away from higher-carbon road transport towards efficient and convenient rail-based mobility. In addition, female passengers will benefit from improved safety and quality of service.

The total estimated cost of the project is $997 million, of which $500 million will be financed by the AIIB, $310 million by the Government of Maharashtra and $187 million by Ministry of Railways. The $500 million loan from the AIIB has a 5-year grace period and a maturity of 30 years.

28-Jul-2020: Finance Minister Smt. Nirmala Sitharaman attends the 5th Annual Meeting of Board of Governors of Asian Infrastructure Investment Bank

Union Minister of Finance & Corporate Affairs Smt. Nirmala Sitharaman attended the 5th Annual Meeting of the Board of Governors of Asian Infrastructure Investment Bank (AIIB) through video conference in New Delhi today.

Every year at the Annual Meeting, the Board of Governors meet to take key decisions that impact the Bank’s future. The discussions at the meeting broadly covered official business including election of the President of the AIIB and a roundtable discussion on the theme ‘AIIB 2030-Supporting Asia’s Development over the Next Decade’.

Smt. Sitharaman was identified as a Lead Speaker at the roundtable discussion. In her intervention, Smt. Sitharaman appreciated AIIB’s efforts for fast tracking financial assistance of about $10 Billion to its member countries including India to combat COVID-19 pandemic. Smt. Sitharaman mentioned about Prime Minister Shri Narendra Modi’s initiative of creating a COVID-19 Emergency Fund for SAARC Nations and India’s efforts in supplying critical medical health kits to tackle the COVID-19, and now supporting global efforts of COVID-19 vaccine trials. Besides, the Finance Minister highlighted India’s participation in the “G20 Debt Service Suspension Initiative”.

Smt. Sitharaman also outlined various measures taken by the Government of India to respond to the COVID-19, including the $23 Billion Pradhan Mantri Garib Kalyan Yojana (PMGKP) and $295 Billion Aatma Nirbhar Bharat Package (ANBP), which aim at protecting all sectors and sections of the economy. The Reserve Bank of India eased the monetary policy especially reduced reserve requirements and introduced liquidity in the economy to the extent of almost 3.9% of GDP.

The Finance Minister mentioned that to give a boost to the infrastructure development, India has launched the National Infrastructure Pipeline (NIP) 2020-2025 with estimated expenditure of $1.4 trillion that has created a plethora of fresh investment opportunities for AIIB’s partnerships. Furthermore, she mentioned some of the expectations from the Bank, including introduction of new financing instruments, mobilising private sector finance, providing financing for social infrastructure to achieve the SDGs 2030, and integrating development of climate resilient and sustainable energy access infrastructure into the recovery response to the COVID-19 crisis. Smt. Sitharaman also suggested the Bank to establish Regional Presence which would aid in effective project management and implementation.

The Finance Minister commended the AIIB management for the very healthy growth that the Bank has achieved in a short span of five years and wished success to the Bank’s future endeavours.

17-Jun-2020: AIIB Approves USD750-M Loan to India for COVID-19 Response

The Asian Infrastructure Investment Bank (AIIB) has approved a USD750-million loan to India to assist the government to strengthen its response to the adverse impacts of the COVID-19 pandemic on millions of poor and vulnerable households.

Co-financed with the Asian Development Bank, the budgetary support will go toward bolstering economic aid for businesses, including for the informal sector, expanding social safety nets for the needy, and strengthening the country’s health care systems.

India is extremely vulnerable to the pandemic given that around 270 million people continue to live below the national poverty line and around 81 million live in densely populated informal settlements with limited access to health services, according to the World Bank. The disruption in economic activities threatens to impact poor households disproportionately, especially women, many of whom are in employed in the informal sector.

“Many of the world’s low and middle-income countries are still in the early stages of the health crisis but are already feeling the impacts of the pandemic. This poses an enormous risk for millions across India who have only recently emerged from poverty,” said AIIB Vice President, Investment Operations, D.J. Pandian.

The International Monetary Fund has revised its 2021 GDP forecast for the country to 1.9 percent, which is about 3.9 percent lower than its January 2020 forecast.

Pandian added, “Our support to India also aims to ensure economic resilience to prevent long-term damage to the productive capacity, including human capital, of India’s economy.”

AIIB’s total sovereign loans to India that have already been approved amount to USD3.06 billion, including a recent USD500 million COVID-19 emergency response. The current loan will be the second for India under AIIB’s COVID-19 Crisis Recovery Facility (CRF), which was created as part of the coordinated international response to counter the pandemic, to support AIIB members’ urgent economic, financial, and public health needs and quick recovery from the crisis.

While AIIB does not have a regular instrument for policy-based financing, the Bank is extending such financings on an exceptional basis under the CRF to support its members through projects co0financed with the World Bank or the Asian Development Bank.

AIIB is currently reviewing projects from its members. Projects being proposed under the CRF can be found here. Additional information about the India COVID-19 Active Response and Expenditure Support Program can be found here.

About AIIB: The Asian Infrastructure Investment Bank (AIIB) is a multilateral development bank with a mission to improve social and economic outcomes in Asia. Headquartered in Beijing, we began operations in January 2016 and have now grown to 102 approved members worldwide. By investing in sustainable infrastructure and other productive sectors in Asia and beyond, we will better connect people, services and markets that over time will impact the lives of billions and build a better future.

8-May-2020: Government of India & AIIB sign agreement for $500 million COVID-19 support for India

The Government of India and the Asian Infrastructure Investment Bank (AIIB) signed a US$ 500 million “COVID-19 Emergency Response and Health Systems Preparedness Project” to help India to respond to the COVID-19 pandemic and strengthen its public health preparedness. This is the first ever health sector support from the Bank to India.

This new support will cover all States and Union Territories across India and address the needs of infected people, at-risk populations, medical and emergency personnel and service providers, medical and testing facilities, and national and animal health agencies.

The agreement was signed by Shri Sameer Kumar Khare, Additional Secretary, Department of Economic Affairs, Ministry of Finance, on behalf of the Government of India and Mr. Rajat Misra, Director General (Acting) on behalf of the AIIB.

Shri Khare said that AIIB’s timely assistance will help Government in its efforts to respond to the threat posed by COVID-19 and strengthen the national health systems for preparedness in India. Responding to the urgency of the pandemic, this project was prepared in record time, underlying the efforts of the officials from the Finance and Health Ministries and the AIIB.

The project will enable the Government of India to slow and limit as much as possible the spread of COVID-19 in India by providing immediate support to enhance disease detection capacities by scaling up procurement of PPE, oxygen delivery systems, and medicines, build resilient health systems to provide core public health, prevention, and patient management functions to manage COVID-19 and future disease outbreaks, support research on COVID-19 by Indian and other global institutions working in collaboration with the Indian Council of Medical Research, address significant negative externalities expected in the event of a widespread COVID-19 outbreak and strengthen public structures for the coordination and management of the project.

The primary project beneficiaries will be infected people, at-risk populations, medical and emergency personnel, service providers at medical and testing facilities (both public and private), and public and animal health agencies engaged in India’s COVID-19 response.

Mr D.J. Pandian, AIIB vice-president (Investment Operations), said that building a resilient health system that can effectively treat COVID-19 patients and prevent its spread is the immediate priority. This funding will address this need and strengthen India’s capacity to effectively manage future disease outbreaks.

He further said that facing this unprecedented global challenge, AIIB will play its part and work closely with international financial institutions to help the Government of India with urgent financing they need to shore up their healthcare systems and help their economies recover as quickly as possible.

The project will also enhance the resilience of India’s health system to provide core public health prevention and patient care to better manage COVID-19 and future disease outbreaks. It will help strengthen India’s Integrated Disease Surveillance Program, revamp infectious disease hospitals, district, civil, general and medical college hospitals, and build a network of high containment Biosafety Level 3 laboratories.

Today, about 75 per cent of new infectious diseases begin with human-to-animal contact, including HIV/AIDS, Ebola, and SARS. The project will develop capacity and systems to detect existing and emerging zoonoses, support biomedical research on COVID-19 by Indian institutions, and upgrade viral research and diagnostic laboratories for testing and research.

It will also help address potential significant negative externalities in the event of a widespread COVID-19 outbreak, including comprehensive health awareness and behaviour change campaigns on hygiene practices, wearing masks, social distancing, and mental health and psychological services for vulnerable communities.

The project is being financed by the World Bank and AIIB in the amount of $1.5 billion, of which $1.0 billion will be provided by World Bank and $500 million will be provided by AIIB.

The project will be implemented by the National Health Mission (NHM), the National Center for Disease Control (NCDC) and the Indian Council of Medical Research (ICMR) under the Ministry of Health and Family Welfare.

27-Feb-2018: AIIB approves $1.5 billion in loans to India for infrastructure projects

Asian Infrastructure Investment Bank (AIIB) has approved $1.5 billion in loans to India for infrastructure-related projects in 2018.

China plans to invest more than $100 billion through its Belt and Road scheme to build highways, rail lines, ports and other infrastructure linking Asia, Europe and Africa.

The funds would be used for investment in India’s energy, roads and urban development projects, and the bank will examine allotting more funds for such projects next year.

AIIB’s loans include a $200 million commitment to India’s National Investment and Infrastructure Fund to spend on roads, housing and urban development, and the bank will let the Indian government decide how to use that money. Energy-related projects will primarily be focused on renewables.

China-backed lenders are taking a more hands-off approach to overseas development financing, unlike western banks whose financing often comes with social and environmental strings and strengthens the voice of non-profits.

AIIB wants to encourage the transition to renewable energy but is not against investments in coal-related projects, unlike most of its peers who have campaigned against further investments in coal.

Any foreign investment in renewables is crucial for India, which needs at least $125 billion in investments to complete its ambitious target of adding 175 GW in clean energy by the end of 2022.

7-Jan-2018: AIIB plans to issue first US dollar bonds in June 2018

AIIB plans to issue its first US dollar-denominated bond with minimum worth of a USD billion by June this year. With 84 members so far, the AIIB was officially established in December 2015 and opened for business in January 2016.

The Beijing-based AIIB is a multilateral development bank initiated by China. The bank has an authorised capital of USD 100 billion.

The earliest issuance window will be "toward the end of the first half of 2018," with time required for certain procedures, including the Board of Governors' approval of AIIB's 2017 financial statements as well as borrowing and swap documentation.

The minimum size of the issuance will be one billion dollars, but as demand for the first bond issue from a triple-A multilateral institution in 25 years may be large. In terms of maturity of the bond, the choice will be between three and five years depending on investor demand at the time.

The bank plans to cap its total borrowing volume at USD three billion dollars in 2018.

The AIIB has received three top-notch ratings from the global credit rating agencies S&P Global Ratings, Moody's and Fitch in recognition of the bank's strong capital base and stable outlook.

China is the largest shareholder with 26.06 per cent voting shares in the bank. India is the second largest shareholder with 7.5 per cent followed by Russia 5.93 per cent and Germany with 4.5 per cent

It prioritises investment in energy, power generation, transport, rural infrastructure, environmental protection and logistics in Asia.

2017

4-Aug-2017: India signs loan agreement with the Asian Infrastructure Investment Bank (AIIB) for Financing of US$ 329 million for Gujarat Rural Roads Project

The Loan and Project Agreements for Asian Infrastructure Investment Bank (AIIB) lending of US$ 329 million for Gujarat Rural Roads Project have been signed between the Government of India/ Government of Gujarat and the AIIB.

The objective of the project is to improve the rural road connectivity and accessibility (by providing all weather road connectivity) to 1,060 villages in all the 33 districts in Gujarat state benefiting about 8 million people. The project will also benefit the service providers such as public transport operators, educational institutions, hospitals, local markets and traders.

The project consists of following two main components:

Constructions and Up-gradation of Non-Plan Roads (NPRs): A total of 5000 km of NPRs will be constructed under this component. Besides, it is also envisaged to construct – missing links (last mile connecting to the road network); missing structures (culverts and small bridges); approach roads to educational institutions; and upgrade/ construct roads passing through tribal areas.

Up-gradation of Planned Roads: It is envisaged to upgrade existing earthen and metal roads to black top roads, resurfacing of village roads and other district roads, up-gradation of bridges to prevent flooding and subsequent isolation of flooded villages during monsoon season and widening of village roads and other district roads to ease traffic congestion.

15-Jun-2017: AIIB grants USD 150 Mn loan for India Infrastructure Fund

China-led Asian Infrastructure Investment Bank has approved USD 150 million equity investment loan to the India Infrastructure Fund, the bank's first such loan to fund private projects.

The bank, in which India is a lead partner, has approved two loans and one equity investment totalling USD 324 million to support infrastructure projects in India, Georgia and Tajikistan.

The Infrastructure Fund aims to invest in mid-cap infrastructure companies in India, and to expand the bank's equity and loan deal sourcing pipelines in the private sector through its equity participation in this fund. This initiative will benefit local infrastructure development by enhancing private capital inflows from global long-term investors, such as public pension funds, endowments and insurance companies.

With authorised capital of USD 100 billion, China is the largest shareholder with 26.06 per cent voting shares.

India is the second largest shareholder with 7.5 per cent followed by Russia 5.93 per cent and Germany with 4.5 per cent.

17-Jan-2017: 30 more countries express interest in joining AIIB

30 more countries have applied for joining the China-sponsored Asia Infrastructure Investment Bank in which India is the second largest shareholder. Apart from 57 founding members, 30 more countries have applied to join the Beijing-based bank.

The AIIB was officially established late last year with 57 founding members and with authorised capital of $100 billion.

China is the largest shareholder with 26.6 per cent voting shares. India is the second largest shareholder with 7.5 per cent followed by Russia 5.93 per cent and Germany with 4.5 per cent.

The interest shown by more countries to join AIIB is a demonstration of high recognition of the international community in the efficiency and prospects of the bank.

The US and Japan, however, stayed away from joining the bank while Germany and most of the European countries joined it.

Last June, the bank approved its first four loans, totalling $509 million to fund power, housing and transportation projects in Bangladesh, Indonesia, Pakistan and Tajikistan.