New Delhi, Nov 24 (PTI) State-owned IIFCL has requested the government to bring the space sector under the harmonized list of infrastructure for easier financing of satellite vehicle manufacturing activity in the country.
Currently, India Infrastructure Finance Company Limited (IIFCL) is providing advisory services to the Indian Space Research Organisation (ISRO) through its subsidiary IIFCL Projects Limited (IPL).
"Space sector is something which we have been engaged in through our subsidiary IPL. IPL got repeated mandates from ISRO for helping them in many of their endeavours, including transfer of space satellites," IIFCL managing director P R Jaishankar told PTI.
IIFCL subsidiary has helped in transferring 13 satellites from ISRO to NSIL which involved a very complicated legal process, he said, adding IPL has also done their business plans.
NewSpace India Ltd (NSIL), is the commercial arm of ISRO with the primary responsibility of enabling Indian industries to take up high-technology space-related activities and is also responsible for the promotion and commercial exploitation of the products and services emanating from the Indian space programme.
At the same time, he said, "We would like to engage with the space sector in terms of financing the space satellite vehicles manufacturing and other related areas. So, we have requested the government to include the space sector in the harmonized list of infrastructure so that we can be enabled to provide funding to this sector."
As per the extant guidelines, IIFCL can provide funds only to sectors in the harmonised master list of infrastructure. Presently, it includes five main sectors and 37 sub-sectors.
Earlier this year, the Union Cabinet liberalised Foreign Direct Investment (FDI) policy allowing up to 100 per cent FDI through the automatic route in the space sector.
Foreign firms now planning to build satellites would not require government approval up to 74 per cent of the investment while up to 49 per cent in the case of launch vehicles.
This increased private sector participation would help to generate employment, enable modern technology absorption and make the sector self-reliant.
Besides, Jaishankar said, IIFCL is planning to set up a subsidiary for issuance of asset backed securities (ABS) or covered bonds, as it aims to securitize its assets and conserve capital for further growth in business.
The idea is to hive off part of our assets, he said, adding, "We will maintain a threshold, and we will focus on increasing the sanctions and disbursements more as compared to growing the asset size or loan book size".
Presently, the company is working on details, he said, adding that once it is crystalised, we will take it to the board for its approval.
During FY24, IIFCL reported a 44 per cent jump in standalone net profit to Rs 1,552 crore, aided by an increase in lending and moderation in bad loans.
The state-owned infrastructure finance company had earned a net profit of Rs 1,076 crore in the previous fiscal. The company recorded the highest-ever profit, recovery, sanction and disbursement, furthering turnaround performance that began three years ago.
For the first half ended September 2024, the infra lending company earned a standalone profit of Rs 811 crore, more than half of it earned in the entire FY24.