Lending Into India: Issues For A Foreign Lender

For a foreign lender, India represents a vast opportunity amidst a complex maze of regulatory regime and market peculiarities that differentiate it from other lending markets such as the European and the Asia Pacific market. The lending environment the world over has deteriorated and Indian Infrastructure sector is in need of massive amount of funds to sustain a booming economy. The draft 12^th five year plan (the 12^th Plan) has set a target of 8.2% GDP growth and even in the alternative scenario of 'policy logjam' it is pegged at a minimum of 5%. The total investment in infrastructure sectors in the 12^th Plan is estimated to be around one trillion dollars at prevailing exchange rates out of which 48% has to flow from private sector, obviously most of it will be in the form of debt.