PPP Infrastructure Project Financing in India – Major Risks and Challenges

2012 ◽  
Author(s):  
Pankaj Kumar Gupta ◽  
Harender Verma
Keyword(s):  
Project Financing ◽  
Infrastructure Project

ON THE PRICING OF AN ISLAMIC CONVERTIBLE MORTGAGE FOR INFRASTRUCTURE PROJECT FINANCING

2002 ◽  
Vol 05 (07) ◽  
pp. 701-728 ◽  
Author(s):  
MUHAMMED-SHAHID EBRAHIM ◽  
TARIQULLAH KHAN
Keyword(s):  
Agency Cost ◽  
Rate Of Return ◽  
Cost Of Debt ◽  
Project Financing ◽  
Exogenous Variables ◽  
Muslim Countries ◽  
Fractional Ownership ◽  
Infrastructure Project ◽  
Agency Cost Of Debt ◽  
The Impact

This paper models a default-free convertible facility to finance infrastructure projects in emerging Muslim countries. The mortgage is designed as a combination of an Islamic credit facility (allowing the collateralization of debt by the assets of the firm as espoused in Scott[32], Stulz and Johnson[36]) and inclusion of real warrants (as espoused in Green[12], Haugen and Senbet[15]) to mitigate the agency cost of debt discussed in Myers[27]. Numerical simulation is employed to endogenously solve for the rate of return, tenure and fractional ownership to be conveyed to financier upon conversion of the facility without resorting to any interest based (ribawi) index. Finally, sensitivity analysis is conducted to study the impact of exogenous variables and to reconcile with the existing mainstream finance literature such as Barclay and Smith[3], Stohs and Mauer [35] and Guedes and Opler [13].

scholarly journals Application of Al-Ijarah Al-Maushufah Fi Al-Dzimmah for Infrastructure Project Financing in Indonesia

Yuridika ◽  
2019 ◽  
Vol 35 (1) ◽  
pp. 129
Author(s):  
Rega Felix ◽  
Lastuti Abubakar
Keyword(s):  
Comparative Approach ◽  
Project Financing ◽  
Normative Study ◽  
Conceptual Approach ◽  
Islamic Bank ◽  
Infrastructure Provision ◽  
Liquidated Damages ◽  
Infrastructure Project ◽  
Financing Infrastructure

Islamic bank has a huge potential to involve in large project financing such as infrastructure. The demand for infrastructure provision in Indonesia is growing rapidly, so the Islamic bank should become one of the financial institutions for a financing infrastructure project. One of the products of Islamic bank is lease based contract or ijarah. In 2016, the Indonesian Islamic Scholars Council (MUI) enacted Fatwa that allowed ijarah contract for a forward obligation or called al-ijarah al-maushufah fi al-dzimmah (IMFD). IMFD has some characteristics that equitable for infrastructure project needs, such as for long term financing. The main issues in this research are to drawn a model for infrastructure project financing by applying IMFD and observe the readiness of Indonesian regulation to support the implementation of IMFD on infrastructure project financing. The type of research is the normative study, and the approach of this research having four methods approach among others are statute approach, conceptual approach, cases approach, and comparative approach. The results of this research are model for infrastructure project financing by applying IMFD is by combining musharakah-istishna’-ijarah (IMFD) and regulation in Indonesia is not ready enough to support the implementation of IMFD on infrastructure project financing because combination of three contracts like musharakah-istishna’-IMFD, implementation of liquidated damages in istishna’ contract, and allowance IMFD in infrastructure project are not regulated in Indonesia.

scholarly journals Islamic financing for infrastructure projects and its implementation barriers

2019 ◽  
Vol 270 ◽  
pp. 06005
Author(s):  
Ayomi Rarasati ◽  
Bambang Trigunarsyah ◽  
Eric Too ◽  
Fiona Lamari ◽  
Faiq Bahwal
Keyword(s):  
Delphi Study ◽  
Expert Panel ◽  
Developed Countries ◽  
Infrastructure Development ◽  
Project Financing ◽  
Implementation Barriers ◽  
Risk Avoidance ◽  
Muslim Population ◽  
Infrastructure Project ◽  
Mind Set

Research on Islamic project financing in infrastructure conducted predominantly in Islamic countries and developed countries showed its many benefits. This particular research focuses on Indonesia. As a developing country with a majority of Muslim population, it is reasonable to expect that Islamic project financing may also be a suitable option for financing alternatives in Indonesian infrastructure development. This paper aims to identify the barriers to implementing Islamic financing for infrastructure project development. A Delphi study was conducted to gather the views and opinions of an expert panel. The study found that the main barriers to implementing Islamic project financing are a lack of understanding of the Islamic project financing concept, a resistance to using Islamic finance, and investors’ behavior and characteristics, such as a profit-oriented mind-set and risk avoidance, which might affect the infrastructure stakeholders’ preference for using a sharia-compliant scheme.

scholarly journals Examining the Viability of Istisna for Project Financing: An Economic Perspective

2019 ◽  
Vol 6 (4) ◽  
Author(s):  
Muhammad Najihuddin Nasucha ◽  
Riazuddin Ahmed ◽  
Galad Mohamed Barre
Keyword(s):  
Development Economic ◽  
Special Focus ◽  
Islamic Banks ◽  
Economic Aspects ◽  
Project Financing ◽  
Project Development ◽  
Economic Perspective ◽  
Key Factors ◽  
Infrastructure Project

The objective of this paper is to examine the viability of Istisna for project financing, with a special focus on its economic aspects and the risks associated with the said contract. This paper also aims to investigate the challenges faced by Islamic banks in adopting Istisna as a mode of project financing. This paper first provides an overview of Shariah-compliant project financing; it then discusses the characteristics of Istisna and barriers to Istisna implementation for construction and infrastructure project development. Economic and general legal considerations are key factors that influence the development of Istisna as project financing. This paper also seeks to explore ways to increase the use of Istisna.

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