Guwahati: The government of India and the United States of America have signed an Investment Incentive Agreement (IIA) in Tokyo, Japan. The IIA is expected to lead to enhanced investment support from America’s development finance institutions in a wide range of sectors.

The IIA was signed by Shri Vinay Kwatra, Foreign Secretary of India, and Mr. Scott Nathan, Chief Executive Officer of the United States International Development Finance Corporation (DFC). This IIA supersedes the Investment Incentive Agreement agreed in 1997 by the governments of India and the United States of America.

Significant developments have occurred since the earlier IIA was signed in 1997, including the establishment of a new agency named DFC, a development financing agency of the United States Government, as a successor agency to the former IIA.

Following the passage of a recent US legislation, the BUILD Act 2018, the Overseas Private Investment Corporation (OPIC) was established. To stay up with the (Dedicated Freight Corridors) DFC's increased investment assistance programmes, such as loan, equity investment, investment guarantee, investment insurance or reinsurance, feasibility studies for possible projects, and awards, an IIA was signed.

The Agreement is the legal necessity for DFC to continue providing investment support in India. DFC or its predecessor organisations have been engaged in India since 1974, providing $5.8 billion in investment support, $2.9 billion of which is still due.

DFC is considering proposals totaling $4 billion for investment assistance in India. DFC has offered investment assistance in development-related areas such as COVID-19 vaccine production, healthcare finance, renewable energy, SME financing, financial inclusion, infrastructure, and so on.

The signing of the IIA is projected to result in more investment assistance offered by DFC in India, which will aid in India's growth.