International Finance Corporation - (IFC)

IFC's Mission

Our mission is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people's lives.

Our Shared Principles & Practices

IFC, a member of the World Bank Group, is a global investor and advisor that is committed to promoting sustainable projects in our developing member countries that are economically beneficial, financially and commercially sound, and environmentally and socially sustainable.

We believe that sound economic growth is key to poverty reduction; that it is grounded in the development of entrepreneurship and successful private investment; and that a conducive business environment is needed for the latter to thrive and contribute to improving people's lives.

We seek to continuously improve our performance by responding to clients promptly, sharing our successes, and learning from our experience. We are committed to and strive to achieve the following principles:

Added Value

We add value to our developing member countries by:

• Taking educated risks that the private sector will not take alone;
  
• Pioneering opportunities in frontier countries and sectors, to maximize our projects' demonstration effect and catalytic role;
  
• Innovating by developing new products and services that better meet our clients' needs;
  
• Providing quality advice when the private sector is unwilling or unable to do so;
  
• Sharing knowledge to promote successful private investment, entrepreneurship, and enabling business environments;
  
• Integrating fully best environmental, social, and corporate governance practices in all our work; and
  
• Being responsive to their needs and those of our private sector clients in a timely manner.

Integrity

We act with integrity in our transactions and daily work by:

• Holding ourselves and our clients to the highest professional and ethical standards;
  
• Recognizing, in every investment, the importance and value of good corporate governance;
  
• Seeking to be transparent, accountable, and equitable; and
  
• Being honest, open and fair in our dealings with each other, with our clients and with local communities.

Environmental & Social Sustainability

We have a core commitment to sustainable development by:

• Ensuring that our projects attain high environmental and social standards;
  
• Consulting with local communities on project-specific environmental and social impacts and opportunities;
  
• Working with responsible clients and other lenders, and local NGOs; and
  
• Listening actively and responding to stakeholders and their concerns.

We are people from all over the world who:

• Are challenged by and enthusiastic about our mission;
  
• Are committed to excellence;
  
• Hold ourselves responsible for the decisions we make;
  
• Believe we will be rewarded for a job well done; and
  
• Enjoy working in the unique and diverse environment that is IFC.

History

The world was a different place 50 years ago. No one spoke of emerging markets. There was no worldwide trend toward privatization, no communications revolution, no globalized economy. World population was less than half of what it is today. It was into this environment that the International Finance Corporation was born in 1956.

India - Overview

Since 1956, IFC has invested in 210 companies in India, providing nearly $3.5 billion in financing for its own account and $925 million for the accounts of participants in IFC’s loan syndication program.

Our held portfolio of $1.26 billion (as of July 2006) makes India IFC's third largest country of operations. In recent years, we have grown our business substantially, with new commitments reaching $402.8 million in FY 2006.

To reduce poverty and promote sustainable economic growth, we believe that India needs a vibrant private sector which will:

• increase the availability of high-quality infrastructure
• accelerate rural growth
• develop competitive manufacturing and service industries
• strengthen the financial sector

We are therefore focusing our activities on supporting:

• private sector involvement in infrastructure financing
• restructuring and modernization of the manufacturing and services sectors to become internationally competitive
• the development of new financial institutions and products

We are committed to working on the frontiers of private investment, helping bring commercial disciplines and entrepreneurial dynamism to new areas of the economy. We therefore also support private investment in health and education, and innovative applications of information technology.

India - Strategy

The World Bank Group Country Assistance Strategy focuses on improving government effectiveness; investing in people and empowering communities; and promoting private sector-led growth through provision of adequate infrastructure, accelerating rural growth, and fostering a competitive economy. The strategy for promoting private-sector led growth is further elaborated in the World Bank Group’s Private Sector Development Strategy, appended to the CAS, which proposes that the World Bank and IFC work closely together to:

• Facilitate greater competitiveness through (a) improvements in the investment climate (b) improved financial intermediation to the private sector and (c) direct support to firms to promote their growth and competitiveness;
• Improve the quantity and quality of infrastructure through greater private participation;
• Promote the provision of private health services;
• Improve rural productivity and growth through greater private investment.

Press Releases: India
Link

Programmes and Interventions

Project Number 25295
Project Name Aquarius India Fund
Country India
Sector P - Collective Investment Vehicles
Company Name Aquarius Fund
Environmental Category FI
Date SPI Disclosed 31 Oct 2006
Projected Board Date 30 Nov 2006
Project Name Aquarius India Fund

Project sponsor and major shareholders of project company

The Principal Sponsor of the Fund is Aquarius Capital Asia Pte. Ltd. The Fund will be managed by Aquarius Investment Advisors Pte. Ltd. (the Manager), an entity based out of Singapore. Current shareholders of the Manager include Chanrai Investment Corporation, R Jayachandran and AST Rajan. The Manager has a subsidiary in India, Aquarius Investment Advisors (India) Pvt. Ltd which will be the investment advisor for the Fund.

Total project cost and proposed IFC investment

The total Fund size is up to $200 million and IFC is considering an equity investment of up to $20 million.

Location of project and description of site

The Fund will invest in India and Indian related investment opportunities.

Description of company and purpose of project

Aquarius India Fund (the Fund) is a $200 million private equity fund focused on growth capital investments in India and India related investment opportunities. The objective of the Fund is to make a series of investments with an expected holding period of three to seven years in order to capitalize on the demonstrated growth of the Indian economy.

Environmental and social issues - Category

This project has been classified as a Category FI project according to IFC’s Environmental and Social Review Procedure. During appraisal, IFC will analyze the Fund’s expected portfolio and sectors of investment and determine the Applicable Requirements if any, that would include a combination of: - the IFC FI Exclusion List; and/or - the applicable National Social and Environmental laws and regulations; and/or - the IFC Performance Standards. IFC will also review, if required, the capacity of the Fund to manage social and environmental risks and to establish and maintain a Social & Environmental Management System (SEMS). IFC will suggest Supplemental Actions to address any gaps in the SEMS if required. The Fund Manager will be required to: - develop an, or upgrade if necessary any existing SEMS, prior to disbursement, to the satisfaction of IFC; - identify responsible, qualified persons to manage and implement the SEMS; - commit to implement the SEMS, to ensure that its investments/activities are in compliance with the Applicable Requirements; - take action to remedy any gaps in SEMS implementation on an ongoing basis; - submit a periodic report to IFC as per a format to be provided by IFC.LotusScript compilation error for Block Component: SelectedProjectBlock: $EXECUTE$+105: Object variable not set - cannot continue.

Project Number 25474
Project Name Cairn India
Country India
Sector B - Oil, Gas and Mining
Company Name Cairn India Ltd.
Environmental Category B
Date SPI Disclosed 26 Sep 2006
Projected Board Date 26 Oct 2006

Project sponsor and major shareholders of project company

Cairn India was founded and registered as a limited company in India in August 2006. It is currently a wholly-owned subsidiary of Cairn UK, with the latter expected to remain a significant shareholder following the planned IPO of the company.

Total project cost and proposed IFC investment

The total project cost is estimated at $1.6 billion. IFC is considering an equity investment in Cairn India in the form of ordinary shares of up to $45 million equivalent

Location of project and description of site

The project activities shall be undertaken in several locations in India, including in the states of Andhra Pradesh, Gujarat and Rajasthan. The company maintains corporate offices in New Delhi and Chennai, India, as well as project offices at its exploration and production sites.

Description of company and purpose of project

Cairn India Limited (Cairn India or the company) is a newly incorporated Indian company which has been formed by Cairn Energy PLC (Cairn UK), a crude oil and natural gas exploration and production company trading on the main market of the London Stock Exchange, to acquire those of its subsidiaries which hold all of the ownership and operated interests of its Indian crude oil and natural gas development and production assets and the majority of its Indian crude oil and natural gas exploration assets. The acquisition will be financed by a series of equity financings including a public offering in India and listing on the Bombay Stock Exchange and National Stock Exchange of India Limited. Following the listing, Cairn UK is expected to remain a majority shareholder in the company. With the support of the central and state governments and regulators and in partnerships with key industry participants such as ONGC, Cairn UK has been exploring, as well as operating development and production assets, in India for over 12 years. Cairn India’s primary asset is a 70% working interest in a development area in Rajasthan, where, in January 2004, Cairn India discovered the Mangala field, the largest onshore crude oil field discovery in India since 1985. In addition, Cairn India’s key assets include operated interests in producing fields at Ravva in Block PKGM-1 (22.5% working interest) in the Krishna-Godavari Basin offshore eastern India and at Lakshmi and Gauri in Block CB/OS-2 (40% working interest) in the Cambay Basin offshore western India. Further, Cairn India has an interest in a number of exploration blocks across India. The company’s medium term capital expenditure program will focus primarily on Rajasthan and is expected to comprise additional exploratory, appraisal and development drilling as well as the construction of oil and gas processing and export facilities. It will also include a component covering further exploration and development in currently producing fields as well as exploration in non-producing fields.

Environmental and social issues - Category

This is a Category B project according to IFC’s Procedure for Environmental and Social Review of Projects because a limited number of specific environmental and social impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The review of the project consisted of appraising technical, environmental and social information, in addition to appraising the operations of the company. The following corporate systems and potential environment, health, safety and social impacts of the project were analyzed: - establishing an integrated Environmental, Health, Safety and Social Management System at the corporate level, as well as a specific system for India; - the company’s capacity to manage multiple projects and implement the Integrated Management System; - impacts from construction, including transportation of materials; - air emissions; - greenhouse gas emissions; - water supply and disposal; - liquid and solid waste disposal; - noise from drilling operations; - contamination from past or present operations; - public and worker safety; - emergency response plans including oil spill response; - land acquisition and compensation; - community development; and - public consultation. The company has presented plans to address these impacts to ensure that the proposed project will upon implementation of the specific agreed measures, comply with all relevant environmental and social requirements, namely the Indian laws and regulations, and the World Bank/IFC environment and social policies and environmental, health and safety guidelines. The information about how these potential impacts will be addressed by the company is detailed in the Environmental and Social Review Summary disclosed in the World Bank Infoshop.

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IFC and India

Overview - IFC

The International Finance Corporation is the private sector arm of the World Bank Group. IFC's mission is to promote private sector investment in developing countries, which will reduce poverty and improve people's lives. IFC finances investments with its own resources and by mobilizing capital in the international financial markets. IFC also provides technical assistance and advice to governments and businesses.

· IFC is the world's largest multilateral source of equity and loan financing for private enterprises in developing economies. Its financing is long-term and market-priced.
· IFC's share capital is provided by its 177 member countries, which collectively determine policies and approve investments.
· IFC committed 217 projects in FY04, providing $4.8 billion of its own financing, and $880 million from private firms through its loan syndication program in FY04.
· IFC shares project risk with sponsors and financial partners but does not participate in project management.
· IFC's charter requires it to be profitable. The Corporation has made a profit every year since its inception.
· IFC does not accept government guarantees.
· IFC has over 2250 staff working in Washington D.C. and in more than 86 field offices in 74 countries.

IFC's participation in projects helps reassure and balance the needs of each party in a transaction: foreign investors, local partners, other creditors and government authorities.

IFC and India

Since 1956, IFC has committed financing to projects in India, amounting to $3.3 billion. Investments include $2.8 billion for IFC's own account and $525 million for the account of banks participating in loan syndications.

private participation in key infrastructure sectors. IFC recently provided AD Hydro Power Limited with a loan and equity investment to support the construction, operation, and management of one of the first merchant hydro power plants in Asia. IFC has also supported the establishment of the first public private partnership in India's power transmission sector through Powerlinks, a joint venture between the Tata Power Company and Power Grid Corporation of India.

Financial Sector
IFC has supported innovation in financial services, including the expansion of consumer and housing finance for lower income groups through Mahindra Financial Services, Sundaram Home Finance, and Housing Development Finance Corporation Limited. More recently, IFC has continued to support the strengthening of the financial sector through investments in Sundaram Finance to expand its lending to commercial vehicle owners and operators in rural and semi-rural areas; and Kotak Mahindra Bank to support its lending to SMEs.

Information Technology
IFC has also focused on the innovative application of technology by backing IT companies whose products
offer potential for important contributions to economic development. Examples include New Path, which designs computer chips, and DQ Entertainment, an animation company.

IFC's held portfolio of $1.2 billion (as of end March 2005) makes India our third largest country of operations.

To reduce poverty and promote sustainable economic growth, IFC believes that India needs a vibrant private sector which will:

· increase the availability of high quality infrastructure
· accelerate rural growth
· develop competitive manufacturing and service industries
· strengthen the financial sector.

IFC is therefore focusing our activities on supporting:

· private sector involvement in infrastructure financing;
· restructuring and modernizing of the manufacturing and services sectors to become internationally competitive and developing new sectors, such as biotechnology;
· industry to expand towards a regional or global presence;
· pioneering transactions to develop the financial markets.

IFC provides global expertise to the Indian private sector through its technical assistance program, e.g., a new regional technical assistance facility to support the growth of small and medium enterprises in the North East.

IFC Project Highlights in India

General Manufacturing
Among IFC's recent investments in India, the Corporation has supported manufacturing companies positioning themselves for international competitiveness, such as compact disk maker Moser Baer; packaging manufacturer Cosmo Films; tire manufacturer Apollo Tyres; steel product maker Usha Martin; agrochemicals producer United Phosphorus Limited; and producer of writing and printing paper, Ballarpur Industries Limited.

Infrastructure
Better infrastructure is essential to sustaining strong growth in India's economy. Hence, IFC is encouraging

Oil & Gas
IFC provided Cairn Energy, PLC, a UK-based oil and gas company, with a long term revolving corporate facility to finance the growth of its production capacity and exploration activities in South Asia, including India. In addition, IFC provided Nike Resources Ltd with a loan to expand its oil and gas production base.

South Asia Department

• Mr. Iyad Malas, Director,
• Mr. Vipul Prakash, Regional Manager
• Mr. Neil Gregory, Head, Strategy and Coordination
• Ms. Ludi Joseph, Corporate Commun. Officer

International Finance Corporation

2121 Pennsylvania Avenue
NW Washington,
DC 20433
Phone: (202) 473-8559;
Fax: (202) 974-4795

International Finance Corporation
50-M, Shanti Path
Gate No. 3
Niti Marg
Chanakyapuri
New Delhi 110 021
India
Phone: (91-11) 5111-1000;
Fax: 5111-1001

International Finance Corporation
Godrej Bhavan
3rd Floor
Murzban Road
Fort, Mumbai 400 001
India
Phone: (91-22) 5665 2000;
Fax: (91-22) 5665 2001

Contacts

Headquarters

Iyad Malas
Director
2121 Pennsylvania Avenue NW
Washington DC 20433
Tel: (202) 473-7682
Fax: (202) 974-4849
E-mail: SouthAsia@ifc.org

Neil Gregory
Manager
2121 Pennsylvania Avenue NW
Washington DC 20433
Tel: (202) 473-8559
Fax: (202) 974-4849
E-mail: SouthAsia@ifc.org

Field Offices

India, New Delhi
Iyad Malas
Director
50 - M, Shanti Path, Gate No. 3
Niti Marg, Chanakyapuri
New Delhi 110 021
Tel: (91-11) 5111-1000
Fax: (91-11) 5111-1001 / 02
E-mail: SouthAsia@ifc.org

India, Mumbai
Sujoy Bose
Senior Manager
Godrej Bhavan, 3rd Floor
Murzban Road, Fort,
Mumbai 400 001, Maharashtra
Tel: (91-22) 6665-2000
Fax: (91-22) 6665-2001
E-mail: SouthAsia@ifc.org

India, Chennai
Prasad Gopalan
Head Chennai Office
56 First Avenue, 2nd Floor
Shastri Nagar, Adyar,
Chennai 600 020, Tamil Nadu
Tel: (91-44) 24462570
Fax: (91-44) 24462571
E-mail: SouthAsia@ifc.org; pgopalan@ifc.org

India, Guwahati
Sushanta Kumar Pal
Business Development Officer
First Floor, Orion Place
Next to Mizoram House
Christian basti, G S Road
Guwahati - 781 005, Assam
Tel: (91-361) 2463 133 - 36
Fax: (91-361) 2463 152
Email: SouthAsia@ifc.org