INDIA INFRASTRUCTURE FINANCE COMPANY LIMITED

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• INDIA INFRASTRUCTURE FINANCE COMPANY LIMITED
• (Wholly owned by the Government of India)

USD 300,000,000 (JPY equivalent) Syndicated Term
Loan Facility Roadshow Presentation, Singapore /
London September 2007
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India Economy - An Overview

• Indian Economy continues to move on growth
  trajectory with strong fundamentals
• 9.4 percent GDP growth in FY 2006-07
• 9.3 percent GDP growth in Q1 of FY 2007-08
• Robust performance in Manufacturing, Construction
  and Services
• Noticeable improvement in Agriculture
• Gross Domestic Savings as share of GDP 32.4 in
  2005-06
• Gross Domestic Investment as share of GDP 33.8
  in 2005-06
• WPI Inflation at 3.94 (15 months lowas
  compared to 5.12 in the corresponding period
  last year)
• Gross Fiscal Deficit for FY 2007-08 estimated at
  5.3-large part of which to be domestically
  financed
• Emerging power of emerging markets

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India Economy Broad Features

• Forex reserves over USD 220 billion in July 2007
• Merchandise exports growth 22.5 in FY 2006-07
• Imports growth 27.8 in FY 2006-07
• Current account deficit 1.1 of GDP
• Priority to sustain a high level of growth with
  contained inflation
• Growth for FY 2007-08 projected at 9 plus
• Strong Rupee
• Liberalized policy for foreign investment
• Sound and stable financial system
• Demographic dividend
• Language edge

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India the second fastest growing economy in Asia
(Average GDP Growth 2002-2006)
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India Infrastructure Scenario Investment Space

• A GoI Study on Infrastructure 1996 projected an
  increase in Gross Capital Formation in
  Infrastructure from the then level of 4.5 of GDP
  to about 8 of GDP by 2005-06.
• In absolute terms, there has been increase
  (public and private) in investment, but the same
  as share of GDP still hovers around 4.6.
• For achieving a GDP growth of 8-9, the
  investment required in the infrastructure sector
  is of the order of Rs.17.57 trillion (USD 425-475
  billion over the next 5 years).
• Objective To create world class and yet cost
  effective infrastructure.

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Projected Investment in Infrastructure -
Sectoral Break-up

• (Rs. Bn.) (USD
  Bn.)
• Power 5,650 138
• Roads 3,330 81
• Railways 2,550 62
• Telecommunication 1,820 45
• Irrigation 1,720 42
• Water Supply Sanitation 1,060 26
• Ports 740 18
• Airports 350 9
• Gas 210 5
• Storage 150 4
• Total
  17,570 430

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India Infrastructure Scenario Policy Issues

• Attracting Private Investment
• Reliance on private public partnerships for
  additional and improved efficiency
• Regulatory framework for PPPs
• Optimal Risk Allocation
• Financial Support to PPPs
• Governance Structure
• Constitution of Committee on infrastructure (CoI)
  under the Chairmanship of the Prime Minister of
  India
• Empowered Sub-Committee of CoI under the
  Chairmanship of Deputy Chairman, Planning
  Commission
• Inter-Ministerial Dialogues through
  Inter-Ministerial Committees
• Consultation with Stakeholders, Users and
  Investors
• Standardization of documents

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India Infrastructure Scenario Sectoral Status

• Highways
• 40,000 Kms to be developed by 2012
• PPP Programs so far approved for around 22,000
  kms
• 6 Laning of 6,500 kms of GQ and other National
  Highways
• 4 Laning of 14,200 kms in selected sections
• 1,000 kms of New Expressways
• Financing plans Viability Gap Funding up to 40
  of capital costs
• Model Concession Agreements
• NHAI
• Ports
• PPP for 54 new berths to add capacity for 640
  ml.t. by 2012
• Perspective plan for 20 years and Action Plan for
  7 years under way
• Model Concession Agreement being finalised
• Rail Road connectivity projects in progress

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India Infrastructure Scenario Sectoral Status

• Airports
• High growth in traffic over 20 per annum
• PPPs in Bangalore, Hyderabad, Delhi Mumbai in
  progress
• 5 Greenfield airports and 35 other airports to be
  developed
• Model Concession Agreement being finalised
• Airport Economic Regulatory Authority to be set
  up
• Railways
• SPV for dedicated freight corridor set up
• Competition in container train movements
  introduced15 Concession Agreements signed
• PPP initiatives in new routes, railway stations,
  logistics
• Focus on technology upgrade and modernization

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Government of India Initiatives

• Setting up of IIFCL
• Viability Gap Funding Scheme
• Promotion of Public Private Partnerships
• India Infrastructure Finance Initiative
• India Infrastructure Project Development Fund
• Model Concession Agreements
• Capacity Building in States for PPPs
• Use of Forex Reserves through Off-shore SPVs

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India Infrastructure Finance Company Limited

• Genesis in the Union Budget Announcement 2005-06
• Incorporated on January 5, 2006, under the Indian
  Companies Act, as a wholly owned GoI Company, to
  provide long term finance to infrastructure
  projects
• Authorized capital USD 250 mio Paid up USD 75
  mio.
• Support of Sovereign guarantee for the Borrowing
  Programme (USD 2.5 billion pa)
• Entity, in the form of SPV, distinct from the
  fiscal budget
• Operations governed by the SIFTI, as approved by
  GoI

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IIFCL - Governance

• High Level Board of Directors
• Mr. S S Kohli, Chairman and Managing Director
• (Ex-Chairman Punjab National Bank-one of the
  top 3 banks in India)
• Mr. Vinod Rai, Secretary to the Government of
  India, Ministry of Finance, Department of
  Financial Services
• Mr. R R Shah, Member-Secretary, Planning
  Commission, Government of India
• Prof. G Raghuram, Professor, Indian Institute of
  management, Ahmedabad
• Other appointments under way
• Sui-generis regulatory set up A Committee of
  independent secretaries, experts
• Three-layers of Audit, including CAG audit at the
  apex level

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SIFTI Domain of Activities

• Business Domain
• Roads and bridges, railways, seaports, airports,
  inland waterways and other transportation
  projects
• Power
• Urban Transport, water supply, sewerage, solid
  waste management, and other physical
  infrastructure in urban areas
• Gas pipeline
• Infrastructure projects in SEZs
• International convention centers and other
  tourism infrastructure projects.
• Provided that an Empowered Committee may, with
  approval of the Finance Minister, add or delete
  any sector/sub-sectors from this list.

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Product Offerings

• Plain Vanilla Debt for tenors exceeding ten years
• Participation in Pooled Municipal Debt Obligation
  Facility to support Urban Renewal Mission and
  help develop Urban Infrastructure
• Participation in India Infrastructure Finance
  Initiative comprising
• A Debt Fund of USD 3 billion (IIFCL-managed)
• An Equity Fund of USD 2 billion (IDFC, Citigroup,
  Blackstone)
• IIFCL contribute USD 25 million in the Equity
  Fund
• Strategic partnership with 3i, IDFC, ILFS and 16
  other banks / institutions to facilitate equity
  and debt support to infrastructure projects
• Other Financing Windows-Proposal to set-up
  off-shore subsidiary

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Liability Management Sources

• Fund Raising Initiatives
• Multilaterals / bilateral sources
• World Bank
• Asian Development Bank
• Japan Bank for International Cooperation
• KfW, Germany
• External Commercial Borrowings
• Domestic markets
• Insurance Funds
• Provident Funds
• Government Sources
• Banks
• Market Borrowings
• Allocation out of Forex Reserves (under
  consideration)

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Business Performance

• Loan approvals during FY 2007
• 47 projects with loan commitment of INR 88.10
  billion (USD 2 billion)
• Participation in PMDO, as a co-sponsor, with a
  commitment of INR 1.5 bn (USD 37 mn) in the total
  corpus of INR 30 bn (USD 750 mn)
• 14 Projects approved with a loan commitment of
  INR 410 mn (USD10 mn) having aggregate project
  cost of INR 21 bn (USD 500 mn)
• Loan approvals during first 5 months of FY 2008
• 17 projects with loan commitment of INR 62
  billion (USD 1.5 billion)
• Aggregate approvals 64 projects with loan
  commitment of INR 15 billion (USD over 3.5
  billion) spread over 20 states of India
• largest amongst banks / FIs in the country in
  corresponding period
• Overall project cost of 64 projects INR1116 bn
  (USD 27 bn)
• Project clients include renowned names like LT,
  Gammon, Reliance, Hindustan Construction, Tatas)

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Expanding Horizons

• Scaling up of Operations
• Projected Loan approvals during FY 2008
• INR 150 billion (Approx. USD 3.75 billion)
• Projected Loan approvals over 5 Years FY 2007-11
  
• INR 800 billion (Approx. USD 20 billion)

• Diversification of Activities
• Participation in IIFI-Equity Funds
  PMDO-semi-equity nature
• Off-shore subsidiary for Credit Wraps-envisaged
• Proposal to set-up an off-shore subsidiary for
  use of foreign
• exchange for infrastructure development
• To act a strong catalyst for building world
  class infrastructure in
• the country

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USPs of IIFCL

• Complete support from the Government in terms of
• Capitalisation
• Guaranteeing
• Governance
• Ratings at par with Sovereign
• CRISIL Rating AAA (SO) / Stable
• ICRA Rating LAAA (SO) / Highest Credit Quality
• International Rating by SP at par with sovereign
  BBB- / Stable
• Policy Intervention Role
• Support from Bilaterals / Multilaterals
• Extensive Business opportunities-Infrastructure
  is critical for sustaining Growth, more so for an
  accelerated pace of growth

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• Summary of Terms and Conditions
• Syndication Timelines

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Terms and Conditions

• Type of Issue Syndicated term
  Loan Facility
• Size US 300 million (JPY
  denominated)
• Guarantor Government of India
• Purpose Financing eligible
  projects in the infrastructure sector.
• Availability Period 9 months
• Maturity Date 10 years
• Repayment Bullet
• Margin US/JPY LIBOR 37bppa
• Governing Law English Law
• Documentation Standard Euroloan
  documentation.

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Invitation Levels

• Sub-underwriting
• Underwriting amount
• Mandated Lead Arranger Bookrunner
• USD 40 mio. All in L43bppa
• Take-and-Hold amount
• Mandated Lead Arranger USD 30 mio
  All in L42bbpa
• Mandated Lead Arranger USD 20 mio.
  All in L41.5bppa
• General Syndication
• Take-and-Hold amount
• Co - Arranger USD 10lt20 mio.
  All in L41bppa
• Lead Manager USD 5lt10 mio. All in
  L40bppa

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Syndication Timelines

• Tentative timetable
• August 27, 2007 Launch of General
  Syndication
• September 05, 2007 Roadshow in Singapore
• September 14, 2007 Roadshow in London
• September 21, 2007 Deadline for Banks Joining
  General Syndication
• W/S Sept 24, 2007 Review of Document

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• THANK YOU

Visit us athttp.www.iifcl.org
http.www.iifcl.com