India: Kotak Infrastructure Investment Fund (AIIB-000547)

Regions
  • South Asia
Geographic location where the impacts of the investment may be experienced.
Countries
  • India
Geographic location where the impacts of the investment may be experienced.
Specific Location
New Delhi
Whenever identified, the area within countries where the impacts of the investment may be experienced. Exact locations of projects may not be identified fully or at all in project documents. Please review updated project documents and community-led assessments.
Financial Institutions
  • Asian Infrastructure Investment Bank (AIIB)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Proposed
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
FI
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Sectors
  • Energy
  • Finance
  • Infrastructure
  • Transport
The service or industry focus of the investment. A project can have several sectors.
Loan Amount (USD)
$ 100.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Investment Amount (USD)
Not Disclosed
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ AIIB website

Updated in EWS Aug 22, 2022

Disclosed by Bank Aug 19, 2022


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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

According to AIIB, the objective of the proposed investment is "to enhance economic and financial sustainability of the infrastructure sector in India by providing sustainable restructuring debt solutions through private capital mobilized from institutional investors."

Kotak Infrastructure Investment Fund (KIIF) is a closed-end private debt fund domiciled in India. The Fund seeks to invest in operating infrastructure companies primarily by providing senior, secured long-term debt solutions, and may also acquire equity shareholding of the borrower in conjunction with the debt facilities. Target sectors mainly include transportation, renewable power, water, logistics, digital infrastructure, and EV transport infrastructure in India.

ENVIRONMENTAL AND SOCIAL INFORMATION

AIIB's Environmental and Social Policy (ESP) is applicable to this project. The project has been placed in Category FI, because the financing structure involves the provision of funds through a financial intermediary (the Fund), whereby AIIB delegates to the Fund Manager the decision-making on the use of AIIB's proceeds for further investing in accordance with the conditions in the Project's legal documentation to be agreed with the Fund Manager in the form of eligibility criteria and investment guidelines, and applied through an Environmental, Social and Governance Framework (ESGF) which is to be used as the Project's Environmental and Social Management System (ESMS).

The Fund has adopted a risk-based approach to Environmental and Social (ES) management codified in its ESGF. As per this ESGF, the Fund Manager: (i) qualifies and quantifies the ESG risks and impacts of potential investees against the applicable ESG regulatory requirements in their jurisdiction of operation and good international industry practices, (ii) defines measures to align their performance with the same, (iii) identifies and enhances ESG-value addition opportunities, and (iv) drives and monitors ESG performance during the investment holding period. Coal mining, coal transportation and coal-fired power plants, as well as infrastructure exclusively dedicated to support any of these activities will be excluded from eligibility for financing under the Project.

The Fund will invest in operating Indian infrastructure projects in the transportation, power, pipeline, water, digital infrastructure, and other infrastructure related sectors. These operating projects present a variety of environmental and social risks in the form of ongoing legacy issues and operational challenges. The risk will be mitigated using the Fund Manager's ESGF policy complemented by monitoring and supervision by AIIB.

For each investment, the Fund Manager shall prepare an Environmental and Social Action Plan (ESAP) determining the required measures to align existing and future operations with the applicable standards. The Fund will be required to disclose the name, industry and location of portfolio companies supported with AIIB's proceeds on its website within twelve months from closing an investment. The Fund will be required to inform AIIB of material ESG incidents and grievances at the subproject level and prepare an annual E&S performance report for submission to AIIB.

The Fund has an External Communication Mechanism (ECM) to address third-party views, enquiries or concerns regarding their own ES processes and outcomes, as well as ES impacts and performances of their subprojects. In addition, AIIB will require the Fund to ensure that subproject entities conduct appropriate stakeholder engagement and disclose the required ES documentation, in line with local regulations, and maintain subproject-level Grievance Redress Mechanisms (GRM).

AIIB will conduct prior review of investments presenting significant E&S risk, including all Category A investments and Category B investments determined to potentially induce a) involuntary resettlement, b) risk of adverse impacts on Indigenous Peoples, c) significant risks to or impacts on the environment, community health and safety, biodiversity, cultural resources or d) significant Occupational Health and Safety risks. AIIB will conduct regular monitoring of the Fund's activities, including visits to selected investments.

Investment Description
Here you can find a list of individual development financial institutions that finance the project.

Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

PROJECT TEAM LEADERS

1.Asian Infrastructure Investment Bank

Pramod Vijayasankar

Principal Investment Officer

pramod.vijayasankar@aiib.org

2.Fanbing Lu

Investment Officer

fanbing.lu@aiib.org

 

IMPLEMENTING ENTITY

Kotak Investment Advisors Limited

Suman Saha

Head – Infrastructure Fund

suman.saha@kotak.com

ACCESS TO INFORMATION

You can submit an information request for project information at: https://www.aiib.org/en/contact/information-request/index.html

ACCOUNTABILITY MECHANISM OF AIIB

The AIIB has established the Accountability Mechanism for Project-Affected People (PPM). The PPM provides Òan opportunity for an independent and impartial review of submissions from Project-affected people who believe they have been or are likely to be adversely affected by AIIBÕs failure to implement the ESP in situations when their concerns cannot be addressed satisfactorily through Project level GRMs or AIIB Management processes.Ó Two or more project-affected people can file a complaint. Under the current AIIB policy, when the bank co-finances a project with another development bank, it may apply the other bank's standards. You can refer to the Project Summary Information document to find out which standards apply. You can learn more about the PPM and how to file a complaint at: https://www.aiib.org/en/about-aiib/who-we-are/project-affected-peoples-mechanism/how-we-assist-you/index.html

The complaint submission form can be accessed in Arabic, Bahasa Indonesia, Bengali, Chinese, English, Tagalog, Hindi, Nepali, Russian, Turkish, or Urdu. The submission form can be found at: https://www.aiib.org/en/about-aiib/who-we-are/project-affected-peoples-mechanism/submission/index.html

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How it works