Kerala CM rings bell at London Stock Exchange

Masala bonds issued by the Kerala Infrastructure Investment Fund Board (KIIFB) have been listed at the London Stock Exchange on Friday.

According to a statement from Kerala chief minister's office, Chief Minister Pinarayi Vijayan formally opened the listing by ringing the bells at the London Stock Exchange.

The KIIFB, an agency under the Kerala government, aims to pool Rs 2,500 crore in the initial phase for investing in Kerala's infrastructure development.

Masala bonds, which are denominated in Indian rupees with the borrower taking the risk of exchange rates, would be listed at the Singapore stock exchange too.

Pinarayi is the first chief minister to be invited by the London Stock Exchange for such a ceremony. The masala bonds would have a five-year cap and an interest of 9.723%.

The Opposition party in Kerala, the Congress, has alleged corruption in the masala bonds.

Opposition leader Ramesh Chennithala expressed fear that there was a risk of masala bonds leading the state to a debt trap.

He was also suspicious over the investments by CDPQ, a Canadian pension fund firm having links with the Canadian firm SNC Lavalin, which is said to be blacklisted.

More than a decade ago, Pinarayi was accused in a corruption case pertaining to SNC Lavalin's contract with the state on power projects— Pinarayi was then the power minister.