India Infrastructure Finance Company Limited (IIFCL) - Guarantee Facility Credit Enhancement of Project Bonds (India)

To deepen India’s infrastructure bond market, the Asian Development Bank (ADB) partnered with India Infrastructure Finance Company Limited (IIFCL) to launch a partial credit guarantee (PCG) facility in 2012. The facility supported IIFCL in enhancing bond ratings to at least AA, enabling institutional investor participation. 

Three transactions reached financial close, including ReNew Wind and Hindustan Solar, with a total PCG exposure of $12.3 million. ADB’s technical and risk-sharing support improved investor confidence, while IIFCL later issued enhanced bonds independently. Despite limited financial returns, the initiative is rated successful in private sector development, environmental compliance, and knowledge transfer. Lessons include aligning market conditions, simplifying legal structures, and strengthening implementing agency capabilities.