NIIF, India’s first sovereign wealth fund set up by the government in February 2015, is looking to raise about $1 billion for its fund of funds to invest in up to 10 private equity funds managed by fund managers in the country.
Its portfolio funds are expected to provide growth capital to firms across sectors, including green infrastructure, affordable housing, manufacturing, and services.
In a statement, ADB said it has joined the Indian government and the Asian Infrastructure Investment Bank (AIIB) as investors in NIIF Fund of Funds, which has now secured $700 million in commitments.
Diwakar Gupta, a vice-president for Private Sector and Public-Partnerships at ADB, said the investment comes at a time when countries globally are facing unprecedented challenges.
“ADB’s investment in NIIF Fund of Funds will help catalyze institutional capital into domestic private equity funds in India, thereby contributing to greater availability of long-term growth financing for private sector companies,” Gupta said.
NIIF Managing Director and Chief Executive Officer Sujoy Bose said ADB’s commitment is “highly meaningful” and “reflects ADB’s confidence in the continued growth and potential of the Indian economy.”
“With this capital infusion, NIIF Fund of Funds will be able to increase its support to India-focused private equity fund managers at a time when global fundraising prospects may be challenging in the short term,” Bose added.
In June 2018, AIIB had approved an equity investment of $100 million as part of NIIF FoF’s initial closing, while the New Development Bank (NDB), earlier known as the BRICS Development Bank, committed $100 million.
NIIF currently manages over $4 billion of capital commitments across three funds.