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INTERNATIONAL NETWORK |
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| January 2008 - India: exceptional growth supported by Calyon |
India's economy is growing at a dramatic pace. In this environment, competition in the banking industry and in infrastructure financing is becoming cut-throat.
Calyon, strongly established in India and the leader in project finance in Asia, wishes to support India in its development and consolidate its already pre-eminent position on this market.
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 An extensive coverage of the territory
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Calyon India is chiefly active in the following areas:
- capital markets,
- bank syndication (in foreign currencies),
- trade finance,
- commodities structured finance.
Calyon India now operates six branches: Mumbai (since 1981), New Delhi (since 1993), Ahmedabad (since 1994), Chennai (opened 1997), Bangalore and Pune (since 2005).
With nearly 130 employees distributed amongst the country's six main industrial and financial centres, Calyon ranks amongst the first five international banks in India. In syndicated credits, Calyon India has been the top Mandated Lead Arranger since 2005.
- An expertise to help our Indian customers in finding solutions
With its expertise in terms of local financing and hedging instruments Calyon is ideally positioned to meet efficiently the needs of increasingly international oriented Indian customers.
- Un leader en financements structurés
The leader in project finance, both worldwide and in Asia, Calyon has a solid experience in advisory and debt arrangement in the areas of energy and infrastructures.
These strong points enable Calyon to claim today a first class position in the booming infrastructure sector as illustrated by its role as Financial Advisor to Hazira Port Private Ltd.
The rapid development of the Fixed Income Markets (FIM) offering | |
Calyon India has a strong position in Interest rate and foreign exchange derivatives. This is a major asset in the approach to infrastructure financing since Calyon's ability to devise and hedge financial structurings of up to 10 years and more is already recognized.
This proven hedging expertise was availed by Indian banks on several occasions in 2007. In this connection, ICICI, India's largest private bank, successively negotiated two USD 1bn interest rate swaps for terms of up to 10 years. These are the largest swaps ever entered into by an Indian bank.
These operations give Calyon a good visibility on the market and enhance its credibility regarding value added hedging solutions.
In 2008, Calyon's FIM teams will start a rupee denominated debt origination activity. This will round out Calyon's current offering in the areas of financing in foreign currencies (syndicated loans). The launch of this activity should boost the number of local operations and will offer to the main clients or to the sponsors of infrastructure projects, on a case-by-case basis, substantial long term loans in foreign currencies. | |
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New opportunities in sight | |
While the PRC is in the limelight because of the rapid strides of its economy, India offers a similar potential maybe more stable in the long term. Already to a large extent regarded as a player to be reckoned with in services and IT, India is poised to become a major player in the world economy.
India is facing major challenges. The country posts economic growth of 9%, a brisk pace which is hard to sustain over a long period. Furthermore, infrastructures are dramatically substandard: badly maintained roads, saturated airports, frequent power failures and obsolete city transport. To successfully take up the growth challenge, India needs to raise from 6% from 4.6% of its Gross Domestic Product the share of its investments in infrastructures. During the next five years, which will be decisive for the country's economy, India has to invest a total USD 331bn in international class infrastructures: ports, airports, roads, telecommunications and power.
Involving private partners is the most viable and efficient way to boost development. The Indian Government is conducting several projects along these lines such as the PPP (public/private partnership) government backed infrastructure projects started in recent years.
Amongst other solutions implemented by the Government to foster private investment in infrastructures are the possibility of financing 100% of the projects with direct foreign investments, 10 to 12 year tax holidays or straight tax incentives. Very ambitious infrastructure projects are currently on the drawing boards in the areas of electricity, ports and airports, roads and telecommunications.
With the increasing size of transactions, opportunities are getting more numerous, particularly for large syndications. Calyon, the leader in this area, holds all the cards to meet efficiently the needs of the Indian economy for infrastructures.
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