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IDFC infrastructure fund to be ready by Sept

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CHENNAI, June 19

INFRASTRUCTURE Development Finance Company Ltd (IDFC) will operationalise an Infrastructure Equity Fund by September, and diversify its areas of operations, according to Mr Nasser Munjee, Managing Director and Chief Executive Officer, IDFC.

Addressing a press conference here on Wednesday following the company's annual general meeting, he said that by September, IDFC would have an operating fund in place for infrastructure funding, as outlined by the Union Finance Minister, Mr Yashwant Sinha, during his Budget speech. While transportation would be a major area of focus, IDFC plans to diversify into new areas such as tourism, oil and gas (production and transportation), education and health, he said.

Transportation is expected to be a major growth area with the increased opportunities for investment. The focus areas include the commercialisation of airports and port with increased involvement of the private sector and the changes in the railways operations and service provision. In the road sector, the company has introduced the private financing initiative and steered the annuity financing of roads, and nine road projects had been bid out using this model. These were bid out at below benchmark rates based on the cost of implementation by public sector, he said.

With 95 per cent of the infrastructure in the public sector in India, private financing initiative was one of the options available to India to encourage private investment in infrastructure. IDFC was actively looking at this mode of encouraging investment in infrastructure.

Urban infrastructure was another growth area IDFC was planning to initiate discussions with Tamil Nadu Government and the Mumbai Municipal Corporations, he said. It has recently signed a MoU with the Delhi Municipal Corporation regarding solid waste management and transport projects.

According to an IDFC press release, its cumulative outstanding approvals aggregated Rs 6,486 crore and disbursement (including non-funded commitments) were Rs 2,851 crore as on March 31, 2002. IDFC's total exposure to infrastructure projects was Rs 5,736 crore with the telecommunications sector absorbing 37.26 per cent, energy 29.43 per cent and transportation 27.70 per cent.

At the AGM, the shareholders approved a dividend at the rate of Re 1 (10 per cent) per equity share for 2001-02. The company reported a net profit of Rs 186.68 crore on a total income of Rs 405.30 crore.

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