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With India emerging as one of the most preferred investment destinations globally, World Bank's private equity arm, International Finance Corporation, aims to cross $500 million mark in new investments by June.
"IFC's currently-held portfolio is $1.3 billion (as of June 2006) making India its fourth-largest country of operations. In FY 06-07 (ending June 30), we hope to surpass the $500 million level in new investments in India," IFC South Asia senior manager Sujoy Bose told PTI.
During the fiscal, IFC invested over Rs 91.71 crore (Rs 917 million) in a subsidiary of Moser Baer, a manufacturer of optical storage device, and infused about Rs 82 crore (RS 820 million) for assisting Kanoria Chemicals in its expansion plan.
It has also picked up 11.48 per cent stake in Granules India for around Rs 26 crore (Rs 260 million) and has committed a $50 million loan to Orissa-based cement manufacturer OCL India Ltd.
IFC would also invest over Rs 101.37 crore ($25 million) to help expansion of the production capacity of electronic bikes marker Electrotherm India in Gujarat.
"As a multilateral institution, it is our job to seek out small and medium sized companies with a potential for significant growth and play the role of a strategic investor and adviser to strengthen their competitiveness and to help them become environmentally more responsible," Bose said.
The private lender said despite strong economic growth in the past years, poverty still remains widespread in India and hence at an institutional level, IFC helps in improving SMEs' access to finance.
IFC's focuses on supporting companies that do not have easy access to long term funding. In the past, IFC had invested in companies such as Bharat Forge and Titan Watches, which later grew into global brands, in their early stages.
The list also includes industrial giants like Tata Steel, Larsen and Toubro, Bajaj Scooters and Arvind Mills.
In the financial sector, IFC played an institution-building role and was a founding investor in key financial institutions such as HDFC and IDFC and continues to be their partner.
"About $300 million has been invested by IFC in the financial sector this year in India," Bose said.
IFC has invested about $23 million in equity in Cairn India, wherein it would work towards extending the company's leadership on environmental best practices and social development.
The World Bank's equity arm was recently involved with small companies such as ABC Coffee, Ocimum Bio, OCL, Kanoria, Electrotherm, Suguna Poultry, LG Balakrishnan, PSL, Drishti, Nevis, Montalvo, Indecomm and iLabs.
As of financial year 2006, IFC has the largest exposure in the manufacturing sector, followed by financial sector. Pulp and paper, steel products and chemicals formed a large part of the manufacturing portfolio of the institution.
In India, IFC focuses on supporting private sector-led development through direct investment and advisory services that promote growth and competitiveness, Bose said.
Elaborating on its strategy, Bose said IFC would support energy efficiency, cleaner production and use of renewable energy in industry and infrastructure and promote SME development through advisory services.