Deals worth $23.5 billion likely to be signed during PM Modi’s China visit
New Delhi: Deals worth $23.5 billion are likely to be signed during PM Narendra Modi's China visit, including new joint ventures which could see investments of $17 billion and $6 billion of financing.
These include a $2.5-billion financing for Bharti Airtel from Chinese lenders, a $3.5-billion venture by the Adani Group as well as big-ticket investments by JSW Steel, GMR and Welspun. With the exception of Bharti, the other companies are likely to sign joint venture agreements with Chinese partners.
The traffic is not entirely one-way as big investments by Indian IT majors Wipro and Infosys in China will also be announced during the visit, said people familiar with the matter.
India's largest telecom company by subscriber numbers and revenues is raising $2.5 billion from Chinese banks. This includes $1 billion of financing from China Development Bank, which will go towards paying spectrum fees. The bank is also providing an additional $1 billion for purchase of equipment from Chinese manufacturers ZTE and Huawei.
In addition, Bharti Airtel will sign a memorandum of understanding with Industrial & Commercial Bank of China (ICBC) for a credit facility of $500 million. Bharti Airtel declined comment on the issue.
The Adani Group is setting up an integrated photovoltaic industrial park in the Mundra special economic zone (SEZ) in a joint venture with Chinese green energy major Golden Concord Holdings. A framework agreement between the two companies will be signed during Modi's ongoing visit.
The two are also exploring investment opportunities in gasbased power plants. Further, the Adani Group is raising $1 billion from China Development Bank for financing the expansion of Adani Power's Mundra plant. In all, China Development Bank plans to lend $3 billion to Bharti Airtel and Adani. Welspun is setting up a $2-billion integrated steel project in Gujarat in alliance with China National Technical Import & Export Corporation, according to the people cited.
$3.5 BILLION LOANS FROM ICBC
Indian companies will receive $3.5 billion of loans from ICBC. This includes $1 billion each to JSW Steel, Jindal Steel & Power Limited and Infrastructure Leasing & Financial Services (IL&FS), apart from the $500-million facility to Bharti. The IL&FS Group is setting up a 4000 mw thermal power plant through IL&FS Energy Development Company Limited with China Huaneng Group as partner. The project involves an investment of $3 billion. Infra major GMR would enter into an agreement with Guizhou International Investment Corporation for setting up a 2,000-acre industrial park in Kakinada SEZ to house high-end Chinese equipment manufacturers.
The proposed project would entail an investment of $2.5-3.5 billion. Senior GMR officials confirmed the development to ET.
Adani Group declined comment while JSW Steel officials didn't reply to ET's queries. Chinese solar power player CSI will sign a $500-million pact with the Sun Group to produce 5,000 mw of green energy in five years. The deal also envisages manufacturing solar modules locally under the 'Make in India' initiative.
Wipro is setting up a delivery centre in Dalian, China. The $1.25-billion IT project will be in partnership with the Dalian government and Yida China Holding Limited. Infosys, meanwhile, will partner the Dalian government and Yida China Holding to build a China-India Information Service Industry Corridor in Qiannan — an autonomous prefecture of Guizhu.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.