Luxembourg: Impressed by India's economic reforms and its growth potential, European Union-owned European Investment Bank is planning to open its first office in the country soon to significantly expand its operations.
Considered one of the world's largest multilateral borrower and lender, the European Union bank has already started negotiations with the Reserve Bank of India (RBI) to facilitate low cost funding to various infrastructure projects as well as to small and medium enterprise in India.
"We are very keen to open our first office in India soon and it should be in New Delhi. We want to expand our operations in India," Patrick Walsh, director of global partners at EIB, told PTI here.
Complimenting Prime Minister Narendra Modi's economic reforms to boost growth rate, Mr Walsh said EIB was keen to work with the India government and the private sector in the country in a major way.
"India is a major market and I think the new government is initiating policies to help develop private sector. We are looking at big projects, particularly to finance infrastructure projects and also small to medium size enterprises," he said.
EIB's regional manager-South Asia, Sunita Lukkhoo, said EIB is in talks with Indian authorities and private sector to finance a number of major infrastructure projects including the Lucknow Metro project. So far EIB has granted 1.07 billion euros to various projects in India in the last few years.
In January, EIB had signed an agreement with the State Bank of India (SBI) to extend a loan of 100 million euros (about Rs 700 crore) for lending to private businesses in the country.
This is the third tranche of a total sanctioned loan of 200 million euros by EIB. Agreements related to the first tranche of 55 million euros and the second of 45 million euros were signed in June and November 2014.
Mr Walsh said EIB was quite upbeat over growth projections of the Indian economy.
"We had some interesting meetings last week with Indian representatives on huge range of potential projects. We are going to explore with our colleagues in India in the government and in the private sector."
"We are looking at projects relating to climate change, infrastructure projects like metro network. It is a whole range of projects," he said.
The European Investment Bank is owned by the 28 EU member countries. It borrows money on the capital markets and lends it at a low interest rate to projects that improve infrastructure, energy supply or environmental standards both inside the EU and in neighbouring or developing countries.
The IMF on Wednesday had termed Indian economy a "bright spot" on the global economic landscape and raised its growth forecast for the current fiscal to 7.2 per cent. It said India's growth rate would further accelerate to 7.5 per cent in the next fiscal year.
Asked about the volume of fund that EIB is planning to extend to the Lucknow metro project, Ms Lukkhoo chose not to give the details.
She said a number of projects including water supply project in Madhya Pradesh were being considered by EIB.
She said EIB was looking at expanding lending to developing economies in Asia including India and it identified sectors such as private business as well as environmental sustainability and social infrastructure projects as focus areas.
In 2013, EIB had signed a pact for lending 150 million euros to the Exim Bank.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
