In 2017, New Development Bank formed by BRICS nations is planning to more than double its commitment of supporting infrastructure projects. President of NDB, K V Kamath has stated the bank’s plans to tune the project of $ 2.5 billion in 2017.
Addressing the two-day summit of BRICS Business Council, Kamath further added, “We are targeting incremental lending of $2.5 billion over next year and we believe it will be largely in the sustainable and green infrastructure.”
He said, the multilateral lender, which started its operations last year, has made commitments of $911 million in 2016 and hopes to close the year with $1 billion.
The noted banker, who built ICICI Bank as the second largest lender in India said, “Keeping the commitments and the actual lending in mind, NDB has drawn up a plan to raise $1.5 billion from multiple sources next year.”
In expansion of the lending activities, the bank will seek to reduce the cost of borrowing for the member-countries by doing local currency borrowings which does not require any hedging, the noted banker mentioned.
Already, It has done 3 billion yuan ($450 million) in China, as part of a Beijing-approved plan to raise 10 billion yuan in the medium-term, he said, adding it will adopt a similar strategy in other markets as well.
India, where it has committed up to $250 million already, will be among the first countries where it plans to raise money in local currency, Kamath said, adding that a rupee bond issue will be done in the first half of next year.
The Shanghai-headquartered bank is also ramping up its staff and plans to take the head count to 350 over the next three years from the present 60, Kamath said.
Work on creating a centre in South Africa is on track and it will be opening this quarter itself, Kamath said.
The NDB, which will have a capital of $100 billion eventually, has been receiving equity funding from member states as per schedule, he said, adding Russia, China and South Africa have already paid two years’ of their commitment in advance.
Stressing on the need for forging partnerships, Kamath also urged the BRICS leadership to recommend the NDB as an observer at the UN General Assembly.