According To Bain, Saudi Arabia’s Public Investment Fund (PIF) Will Build Out A Plan For Investing In India
According to two persons familiar with the situation, Saudi Arabia’s sovereign wealth fund, Public Investment Fund (PIF), has tasked Bain and Company with developing an India strategy as part of its goal to capitalise on numerous infrastructure spending opportunities.
PIF, the empire’s principal investment group, manages roughly $600 billion in assets and is forming “special economic alliances” with other countries “, one of the organisation’s main goals. After high global crude oil prices bolstered Saudi Arabia’s revenue, the organisation is trying to hunt for chances in India, with the world’s biggest corporation, Saudi Arabian Oil Co. (Saudi Aramco), focusing on green power initiatives.
“PIF is optimistic about India and intends to spend on real estate and infrastructural facilities.” “requesting anonymity, another of the two persons said.
New Delhi favours pension funds or impact investors, who invest for the long campaign to make modest returns, as the Indian government participates in 111 trillion for 7,000 construction projects.
India extended tax-exempt status to sovereign wealth funds on profits from infrastructural projects in India for FY24 in the Union budget for FY21. “To encourage financial institutions of international bodies to invest in targeted sectors, finance minister Nirmala Sitharaman recommended granting a 100 per cent tax-exempt status on interest, dividend, and capital appreciation earnings regarding money invested in architecture and other areas before March 31 2024, with a lower lock-in three – year period,” the government said in a February 2020 declaration.
The government has also increased capital spending for FY23 by a record 35 per cent to $7.5 trillion, including construction projects accounting for the majority of the CAPEX.
Abu Dhabi Investment Corporation, UAE’s Mubadala Investment Co., Singapore’s GIC Holdings Pte Ltd and Temasek Holdings Pte are active asset management companies in India’s infrastructure market.
Until press time, Sunday night’s emails to PIF and Bain and Company representatives had gone silent.
PIF has been hunting for possibilities to invest in India, including purchasing a share in Tata Power’s green energy company. In a joint announcement earlier this month, the firms announced that a consortium led by the world’s largest asset management BlackRock and Mubadala had agreed to invest 4,000 crores in Tata Power Renewables for a 10.53 per cent share.
Under a provision included in the Finance Act, 2020, which took effect on April 1, 2021, more than 12 foreign investors have secured tax breaks for building projects in India. Chiswick Investment Pte. Ltd, Stretford Investment Pte. Ltd, Dagenham Investment Pte. Ltd, Anahera Investment Pte. Ltd, Bricklayers Investment Pte. Ltd and the UAE’s sovereign wealth fund MIC Redwood 1 RSC Ltd are among the Singapore-based financial institutions. This clause also provided tax savings to Canadian and Australian pension funds.
India is embarking on the largest clean energy initiative in the world. It declared intentions to increase non-fossil fuel power production capacity to 500 gigawatts by 2030 and attain net-zero carbon emissions by 2070 at the COP-26 summit in Glasgow last November.