Money & Banking

IIFCL shifting overseas base to Amsterdam to cash in on tax breaks

K. Ram Kumar Mumbai | Updated on July 09, 2012 Published on July 09, 2012

India Infrastructure Finance Company Ltd (IIFCL) plans to move its overseas base from London to Amsterdam to take advantage of the favourable tax regime.

Resources can be raised as efficiently in the financial and business capital of Netherlands as in London. Moreover, the outgo on account of taxation on resources raised and income earned will be less, according to Mr S. K. Goel, Chairman and Managing Director, IIFCL.

The non-banking finance company, which is categorised as an infrastructure finance company, will move its overseas operations to Amsterdam next month.

IIFCL’s UK subsidiary’s cumulative disbursements, including letter of comfort, to 12 infrastructure projects – in power, metro rail, ports, gas pipeline and fertiliser manufacturing – in India since inception in 2008 aggregated $740 million as at March 2012.

Cumulatively, IIFC (UK) Ltd has extended sanctions to 36 infrastructure projects aggregating $3.905 billion.

Lending by IIFC (UK) Ltd is exclusively meant for financing import of capital equipment and machinery by infrastructure projects in India. IIFCL’s overseas arm provides long term foreign currency loans to Indian companies setting up infrastructure projects in India.

Tax-free bonds

Though IIFCL can raise Rs 10,000 crore by issuing tax-free bonds in 2012-13 for financing major infrastructure sectors, it will raise only about a third of the amount as it has sufficient funds. It did not raise funds through tax-free bonds last year.

“We will wait for interest rates to come off a little before tapping the market with tax-free bonds,” said Mr Goel.

FY12 performance

IIFCL, a wholly-owned Government of India enterprise, reported a 98 per cent increase in net profit at Rs 586 crore in the year ended March 31, 2012, against Rs 296 crore in the corresponding period last year.

In 2011-12, loan disbursements, including direct lending, refinance and takeout finance to road, power, port and railway projects, increased by Rs 5052 crore. As at March-end 2012, cumulative disbursements stood at Rs 20,377 crore.


Published on July 09, 2012

A letter from the Editor

Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!


Support Quality Journalism
This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.