Modi & Putin
Russian President Vladimir Putin (L) shakes hands with India's Prime Minister Narendra Modi during exchange of agreements event after India-Russia Annual Summit in Benaulim, in the western state of Goa, India, October 15, 2016.Reuters

Russia will infuse about $500 million in India's infrastructure sector along with equally investing into National Infrastructure Investment Fund (NIIF), which would form the Russian Investment Fund worth $1 billion.

The Russian Direct Investment Fund (RDIF) will be investing $500 million into the joint fund, which would support investment opportunities and growth of Russian businesses in India.

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"The money will be invested in infrastructure projects with Russian component. We will look at energy, petrochemicals, transport infrastructure and different projects where our companies can also have a food in India," Krill Dmitriev, RDIF chief executive was quoted as saying by the Press Trust of India.

An agreement to start the fund will be inked before Indian Prime Minister Narendra Modi and Russian President Vladimir Putin on the sidelines of the ongoing BRICS summit in Goa, Dmitriev said. He also said that the actual flow of money from the arrangement is expected to be higher since Russian businesses tend to invest higher when the RDIF inks agreements with any other country/institution.

"There would be more money from Russian banks, Russian companies and other partners of the RDIF," the actual investments could go up by $8 billion through similar arrangements. "Though most of the investments will be in India, some can also be outside of India. It can be in other countries as well," the RDIF chief executive told the PTI.

The NIIF is a fund, which was created by the Indian government to enhance infrastructure financing in India. With a corpus of Rs 40,000 crore, the fund will attract equity investments from domestic and overseas sources. The central government would contribute 40 percent to the corpus.

The two countries signed 16 agreements and made three other announcements across fields on Saturday during the 17th India-Russia Annual Summit on Saturday in Goa. India and Russia signed agreements in civil nuclear cooperation, LNG sourcing, partnership in Oil and Gas and engagement in renewables can construct an "Energy Bridge" between the two countries, Vikas Swarup, spokesperson for the Ministry of External Affairs tweeted on Saturday.