India to seek AIIB funding for smart city and other major infrastructure projects

After the first annual meeting of the AIIB, Finance Minister Arun Jaitely told that India is expecting $2-3 billion funding from the infrastructural lending institution for financing the country’s infrastructure projects. The new born China sponsored lender – AIIB’s first meeting was held at its headquarters in Beijing.

India need around $1000 bn in few years for the development of the infrastructure sector. Prime Minister Modi has just inaugurated the multi-billion Smart City Project in Pune last day. The initial project execution is planned in fourteen selected cities out of the proposed hundred.

Though the project is implemented at a cost sharing between center-state and private sector, resource constraints is expected to hit soon with the progress of the projects as well as with the inclusion of more cities. A big ticket loan from a multilateral agency is essential to implement the project.

India is a founder member of the AIIB and is the second largest shareholder after China. Finance Minister has asked the AIIB board to start a regional office at New Delhi.

In his statement after the AIIB meeting, the Finance Minister has observed that the country expects financing in energy, urban transport, inland water ways, and water supply besides smart cities.

India’s DJ Pandiian is the Vice President of the AIIB and he will perform as the Chief Investment Officer as well.