India & United States sign new IIA
Tokyo: India and the US on Monday signed a new Investment Incentive Agreement (IIA) to keep pace with additional investment support programmes such as debt, equity investment, investment guaranty, investment insurance and feasibility studies for potential projects and grants.
The IIA was signed by Foreign Secretary Vinay Kwatra and the CEO of US International Development Finance Corporation (DFC), Scott Nathan, ahead of a bilateral meeting between Prime Minister Narendra Modi and US President Joe Biden here on the sidelines of the Quad Summit.
This Investment Incentive Agreement supersedes the Investment Incentive Agreement signed between the two countries in the year 1997.
Significant developments have taken place since the signing of the earlier IIA in 1997, including the creation of a new agency called DFC, a development finance agency of the US Government, as a successor agency of the erstwhile Overseas Private Investment Corporation (OPIC) after the enactment of a recent US legislation, the BUILD Act 2018, the Ministry of External Affairs said in a statement.
The new IIA has been signed, to keep pace with the additional investment support programmes, offered by the DFC, such as debt, equity investment, investment guaranty, investment insurance or reinsurance, feasibility studies for potential projects and grants, it said.
The agreement is the legal requirement for the DFC, to continue providing investment support in India.
DFC or their predecessor agencies are active in India since 1974 and have so far provided investment support worth $5.8 billion of which $2.9 billion is still outstanding.
Proposals worth $4 billion are under consideration by DFC for providing investment support in India.
DFC has provided investment support in sectors that matter for development such as COVID-19 vaccine manufacturing, healthcare financing, renewable energy, SME financing, financial inclusion, infrastructure etc, the statement said.
It is expected that signing of IIA would lead to enhanced investment support provided by DFC in India, which shall further help in India's development, the statement said.
