Securitization in India: Managing Capital Constraints and Creating Liquidity to Fund Infrastructure Assets | Asian Development Bank

Securitization in India: Managing Capital Constraints and Creating Liquidity to Fund Infrastructure Assets

Publication | November 2017
Securitization in India: Managing Capital Constraints and Creating Liquidity to Fund Infrastructure Assets

This report explores securitization of infrastructure assets on public sector banks in India in order to meet the country’s growing infrastructure investment needs.

India needs to spend close to Rs43 trillion (about $646 billion) on infrastructure through to 2022. Such a staggering requirement cannot be met though traditional sources such as public sector bank loans. India must immediately explore and quickly ramp up financing from alternative investment sources. 

This paper explores the securitization of existing infrastructure assets by public sector banks in India, as a means to (i) strengthen their capital position to meet Basel III requirements, (ii) free up capital to help fund new credit growth opportunities, and (iii) ultimately improve fund flow to the infrastructure sector by enhancing its access to institutional investors.

Contents 

  • Infrastructure Financing in India
  • Banking Sector in India
  • The Securitization Market in India
  • Securitization of Infrastructure Assets in India
  • Value Analysis and Success Factors
  • Conclusion
  • Appendixes