INDIA - FTSE Group and Indian infrastructure specialist, Infrastructure Development Finance Company Ltd (IDFC), have launched the first ever Indian infrastructure index, with investable products expected to be launched in August.
The FTSE IDFC India Infrastructure Index Series will represent the performance of those Indian companies listed on the National or Bombay Stock Exchanges generating the majority of their revenue from infrastructure.
Donald Keith, deputy chief executive of the FTSE Group, told Global Pensions: “These indices are the first of their kind. We calculate a global infrastructure index but only a very small portion of that covers Indian infrastructure.
“Current economic growth in India is about 8% to 10% per annum and international investors are very interested in gaining access to this region.”
Illustrating the growth potential for infrastructure in India, Keith continued: “The Indian government recently released a report that said US$320bn needs to be spent on infrastructure and they hope 40% of that will come from the private sector.”
Keith said FTSE was already in “very detailed talks” over the launch of index tracking funds and structured products, which could be expected over the next few weeks.
Dr. Rajiv Lall, managing director and CEO of IDFC, stated: “The Indian infrastructure space is on a long term secular growth path and the FTSE IDFC India Infrastructure Index Series (…) will be extremely useful to Indian and international investors in getting exposure to Indian infrastructure through funds and structured products.”
Keith claimed interest in the sector had come from institutional investors in the US, UK, and Asia, as well as India.
The series contains one tradable and one benchmark index and is calculated in real time and end of day basis. It includes those companies gaining revenues from infrastructure sectors including transportation, energy, communication and construction.
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