NEW DELHI: India and the US signed the Investment Incentive Agreement (IIA) on Monday which is expected to boost investment support by the US International Development Finance Corporation in a wide range of sectors.
The IIA was signed in Tokyo by foreign secretary Vinay Kwatra and Scott Nathan, the chief executive officer of the DFC. The deal is the legal requirement for DFC to continue to make several investments in India, the Ministry of External Affairs stated.
Proposals worth USD 4 billion are under consideration by the corporation for providing investment support in India.
The agreement has been made to keep pace with the additional investment support programmes, offered by the DFC, including debt, equity investment, investment guaranty, investment insurance or reinsurance, feasibility studies for potential projects and grants.
Development Finance Corporation and its predecessor agencies have been functional in India since 1974 and till date have provided investment support worth USD 5.8 billion of which USD 2.9 billion is still outstanding.
Development Finance Corporation has extended financial support in the areas of COVID-19 vaccine manufacturing, healthcare financing, renewable energy, SME financing, financial inclusion and infrastructure.
Foreign Secretary Vinay Kwatra and CEO @DFCgov Scott Nathan sign the India-USA Investment Incentive Agreement (IIA).
— Arindam Bagchi (@MEAIndia) May 23, 2022
In a tweet, Arindam Bagchi said, “Foreign Secretary Vinay Kwatra and CEO @DFCgov Scott Nathan sign the India-USA Investment Incentive Agreement (IIA). The signing of IIA would lead to enhanced investment support provided by @DFCgov in India, thereby encouraging investment in key sectors.”
The Investment Incentive Agreement supersedes the Investment Incentive Agreement signed between USA and India in 1997.
Since the signing of the earlier IIA in 1997, a slew of big developments has taken place including the formation of a new agency called Development Finance Corporation as a successor agency of the erstwhile Overseas Private Investment Corporation (OPIC) after the enactment of the recent legislation in the USA, the BUILD Act 2018.