Financing Opportunity for Japan-India Collaboration Projects Japan Bank for International Cooperation (JBIC) New Delhi Office April 16, 2010

2 Introduction Japan Bank for International Cooperation (JBIC) is a Japanese Government Financial Institution. JBIC conducts its operations with a mission to contribute to the sound development of the Japanese and international economy. JBIC, has made a new start since October 1, 2008, as the international wing of Japan Finance Corporation (JFC), Japan’s policy-based financing institution.

3 Overview of Organizational Restructuring （ Crisis Response ） ODA Operation October 1999 (Note 1) Established based on the “Japan Finance Corporation* Law” (Note 2) Okinawa Development Finance Corporation will be merged into JFC* in FY2012 or later. Japan Finance Corporation (JFC)* （ Notes 1, 2 ） （ Domestic Finance ） National Life Finance Corporation Agriculture, Forestry and Fisheries Finance Corporation Japan Finance Corporation for Small and Medium Enterprise Japan International Cooperation Agency (New JICA) Technical Assistance ODA Loan Grant Assistance October 2008 International Finance Operation (“IFO”) JBIC Export-Import Bank of Japan (JEXIM) Overseas Economic Cooperation Fund (OECF) ODA: Official Development Assistance （ International Finance ）

4 New JBIC’s Mission (1) Supporting and promoting overseas operation of Japanese companies (2) Supporting development and acquisition of important natural resources to Japan (3) Corresponding to financial turmoil in the international economy

5 Relations: India & Japan (“JP”) － Japanese Company in India － (1) Number of Japanese Companies in India (Source: Embassy of Japan) (JCCII: Japan Chamber of Commerce and Industry in India) (Source: JCCII) (2) Number of JCCII Member Companies (3) Existence of JP Companies by States (4) Type of Business JP Companies

6 Survey: Promising Countries for overseas business of JP Companies (Source: Survey Report on Overseas Business Operations by JBIC) Relations: India & Japan (“JP”) － Japanese Investors’ View － [ Reasons & Pending Issues ]

7 (1) Number of UN Registered CDM (Source: IGES) Relations: India & Japan (“JP”) － CDM Projects in India － (2) Breakdown of Indian Registered CDM (463)

8 JBIC Financing Menu (1) Export Loan (2) Overseas Investment Loan (3) Untied Loan & Guarantees (4) Equity Investment Funding to imports from Japan as per OECD guidelines Funding to Japanese subsidiaries & joint ventures in India Funding to projects improving investment climate for Japanese companies in India Capital Contribution to Infrastructure or Eco-Friendly Projects where Japanese companies participate

9 60% 40% Co-Financiers (1) Export Loan - Export Loan through SBI or ICICI- Loan Indian company Japanese Company Export Credit Line Approach and arrange the finance (JPY or USD) Export Indian Company imports Machinery, Equipments, etc. from Japanese Company State Bank of India (SBI)($70mil) ICICI Bank ($100mil) Export Insurance

10 Features - Export Loan - Eligible Borrower: All Indian companies that are importing capital goods & services from Japanese companies Borrowing Amount: Up to 85% of Foreign Export Portion Local expenditure can also be financed as part of overall contract, not exceeding 30% of export portion. Financial Coverage Foreign Portion Local Cost If the contract value is 160 (foreign portion is 100 and local cost is 60), maximum financial coverage is Financial Coverage by export loan = X 85% = x 30% = 30 Down payment = 15 (100 X 15%)

11 Features - Export Loan - Down Payment: 15% of Foreign Portion Repayment Period: up to 10 years Currency: Japanese Yen or US Dollar Interest Rate :  CIRR + OECD Risk Premium + SBI/ICICI Margin *1: CIRR (Commercial Interest Reference Rate): Interest rate applied to Officially Supported Export Credit as per OECD Guidelines, which will change on 15th of each month *2: OECD Risk Premium: To be calculated based on repayment terms, CIRR rate etc. according to OECD Guidelines *3: SBI/ICICI Margin: Only applied to Global Bank Loan (SBI/ICICI two step loan) Environment: JBIC Environmental Guidelines

12 (2) Overseas Investment Loan Factory Equity CAPEX Indian Company Equity/Subsidiary Japanese Company Operation Joint Venture Company Co-Financiers J B I C Loan ($/\/€)

13 Features - Overseas Investment Loan - Eligible Borrower: JV company between Indian company & Japanese company, or Subsidiary of Japanese company Loan Amount: Depends on the Project & Cash flow Tenor: Long Term (more than 1 year), depends on Cash flow Repayment Period: Determined by taking account of Cash flow Currency: Japanese JPY, USD or Euro

14 Sell out SPVs (3)Untied Loan - DMIC / Project Development Fund (PDF) - ＊１ : Delhi Mumbai Industrial Corridor Devlpt. Corp. Loan （ $75Million ） ConsultantProject Developers INDIA ACCOUNT ($75million) JAPAN ACCOUNT ($75million) ＊２： IIFCL ： India Infrastructure Finance Company Ltd. Project Development Fund (PDF) DMIC DC *1 Govt. of India IIFCL *2 Transfer the Loan to PDF Account JBIC Guarantee Utilize funds to conduct Feasibility Study (F/S) for prospective projects Submit F/S Report Payment for sales of SPVs ＜ Project Outline ＞ -Establish SPVs to take all necessary permissions for DMIC Project Developments. -Sell out SPVs to Project Developers. Fund PDF Account （ $75million ）

15 (3)Untied Loan (Guarantee) - NTPC / Power Generation Project - N T P C Private Banks Supply Electricity to Japanese Company Complexes （ $380million ） Guarantee Syndicated Loan J B I C Barh (Stage-I) Super Thermal Power Project in Bihar

16 (3)Untied Loan Factory JV Co. Japanese Company CAPEX Local JP Company Indian Company （ Supporting Industry ） Local JP Company Components Supply - ICICI Bank / Supporting Industry Loan - $350million (Equivalent amount JPY) Co-Financiers J B I C Credit Line ICICI Bank Loan($/\)

17 (3)Untied Loan - ICICI Bank / CDM Loan - CDM Project JP Company Loan ($/\) CAPEX Sales of CER $200 million (Equivalent amount JPY) CDM Project Company ICICI Bank Co-Financiers J B I C Credit Line ($/\)

18 (3)Untied Loan ( Corresponding to International Financial Turmoil) - ICICI Bank / Trade Finance Support Loan- Indian or Local JP Company (Exporter) Indian or Local JP Company (Exporter) Supporting India’s Trade Transactions Loan($) （ $100million ） J B I C Third Country Company （ Importer ） Third Country Company （ Importer ） Indian or Local JP Company (Importer) Indian or Local JP Company (Importer) Third Country Company （ Exporter ） Third Country Company （ Exporter ） Trade Finance ICICI Bank Trade Finance Trade Trade

19 Project A,B,C ・・・ J B I C Equity/Loan Private Banks Private Banks Equity Guarantee Asia Infra. Fund １ Energy Efficiency Fund １ Energy Efficiency Fund ２ Asia Infra. Fund 2 Equity Projects in Asia （ Infrastructure & Energy ） Projects in Asia （ Infrastructure & Energy ） Energy Conservation Project Private Banks Private Banks Loan Equity Project A,B,C ・・・ (4) Equity Invest. / FACE Scheme （ Facility for Asia Cooperation and Environment ）

20 (4) Equity Invest. / FACE Scheme （ Outline of FACE ） Objectives -To mobilize private capital by using JBIC’s equity participation and guarantee functions. -To support the projects politically important to Japan in view of the G8 Hokkaido Toyako Summit : (1) projects contributing to mitigating climate change (including for energy efficiency, renewable energy, etc.); and (2) projects in Asia. Period FY (April 2008-March 2013) Funding To fund this facility, JBIC is to receive 20 billion yen to its International Financial Operation account from the Japanese government’s Fiscal Loan Fund Special Account (investment account).

21 (4) Equity Invest. / FACE Scheme （ FACE Applicable Condition ） -Less Capital Contribution Ration than Japanese Biggest Shareholder, and -Less than 25% Japanese Company’s Participation -Japanese Company’s Equity Participation in the Project, or -Japanese Company’s Equity Participation in Foreign Companies for Business Alliance, or -Japanese Company’s Equity Participation in Funds (Operation & Investment Policy should be lead by Japanese General Partner in the Funds), or -Japanese consortium’s Equity Participation in International Funds Country Developing Country only (In case of Natural Resource Finance, Developed Country is covered) (In case of Natural Resource Finance, Developed Country is covered) JBIC’s Equity Participation

22 (Global action for Reconciling Economic growth & Environment conservation) New Finance Initiative -GREEN- (Global action for Reconciling Economic growth & Environment conservation)  JBIC supports environmental investments in Solar Power, Energy-Efficient Power Plant, Energy-Saving Equipment, etc. for global environment conservation, utilizing advanced environment technology in developing countries  Supports through Loans or Equity Investments.  Applicable Business (Applicable Conditions) (1)Projects for Global Environment Conservation (e.g. Projects contributing to significant reduction of Greenhouse Gas Emissions) (2)Projects agree to “MEASURE” the effect, “REPORT” the effect to JBIC and accept the “VERIFICATION” of the effect by JBIC. Co-operation (Co-finance, Information Sharing, etc) Loans / Loan, etc Catalytic Role Loan, etc MDBs （ ADB, World Bank Group, etc ） Private Financial Institutions J B I C Equity Investment

23 (Global action for Reconciling Economic growth & Environment conservation) New Finance Initiative -GREEN- (Global action for Reconciling Economic growth & Environment conservation)  Main Targeted Sectors (1)Renewable Energy Solar, Wind, Hydro, Geothermal, Biomass Energy, etc (2)Energy Conservation  Industrial Sector; Modernization and Heat Recovery in Steel, Cement, Chemical, Nonferrous Metal and Paper & Pulp sectors, etc  Power Sector; Clean Coal / Gas-Fired / Biomass Power, Rehabilitation of Power Plant, Cogeneration, Fuel Battery, Smart Grid, etc  Transport Sector; Urban Transportation  Civilian Sector; ESCO (Energy Service Co.), Introduction of Energy Saving Appliance, etc  Water Treatment; Water Purification and Supply, etc (3)Other Greenhouse Gas Emission Reduction Projects Methane/CFC Emission Reduction, Nitrous Oxide Degradation, etc

24 Recent Activity in India

25 Thank you very much Mr. Hiromichi Miyamoto, Representative, Ms. Deepa Salvan, Int ’ l Financial Specialist Japan Bank for International Cooperation, New Delhi Office 1st Floor, Metropolitan Hotel New Delhi, Bangla Sahib Road, New Delhi Tel : , Fax: Financing Opportunity for Japan-India Collaboration Projects