The Asian Infrastructure Investment Bank (AIIB) is in talks with the Indian government to develop a pipeline of investible projects, a senior official said today at a briefing in Mumbai.

A 13-member delegation of the AIIB earlier this week met with federal government ministries and is today meeting with the Maharashtra state Chief Minister Devendra Fadnavis and other state officials, said Ajay Bhushan Pandey, the bank’s vice president for investment solutions.

The aim is to have the private sector account for 50% of the AIIB’s overall investments by 2030, up from 34% in 2024, Pandey said at the briefing, organised by the Federation of Indian Chambers of Commerce and Industry. The briefing was also attended by infrastructure fund managers and investors.

India is already the AIIB’s biggest borrower with USD 12bn of the lender’s total loan book of USD 60bn. Out of the USD 12bn invested in India, the private sector there accounts for USD 1.8bn, Pandey said.

The Beijing-based lender invests through multiple instruments, including through funds, equities, guarantees and takeout financing, he said.

Various studies estimate the annual requirement for financing infrastructure in the Global South is between USD 1.5trn to USD 3trn, said Pandey. India requires about USD 1.5trn over the next five years.

This requires stakeholders to collaborate, he said, and the AIIB delegation will hold discussions with India’s National Bank for Financing Infrastructure Development to explore co-financing options, credit lines, guarantees and takeout financing with 30-year tenors.

“The infrastructure gap is so huge that it is imperative that all the agencies involved not only work together but also create a system through which private investments can flow in,” Pandey said.

The use of technology and sustainability-related features can ensure investible projects, he said, adding that in cases where these are not commercially viable, grant agencies may be able to help.

As grants are usually limited, this needs to be combined with other capital sources to create blended finance products, he said, adding that there is a lot of scope for financial engineering to make projects viable.