CDC, the UK’s development finance institution, has committed $ 30 million to Rabo Equity’s India Agri Business Fund 2 (IABF 2). The fund will invest in growing businesses across the agri-business industry, such as agricultural input, food processing, rural retail and cold chain storage and distribution companies.
With CDC as an anchor investor alongside Rabobank, IABF 2 aims to raise up to $ 200 million. Rabo will invest in 12 and 15 small and medium-sized companies with equity investment sizes ranging from $ 5 mn-$ 30 mn. Its first fund – India Agri Business Fund 1, which launched in 2009, made ten investments in companies including Super Agri Seeds, Prabhat Dairy and NCML.
With an estimated total food consumption of $ 250 billion for 2013, India is the third largest consumer of food in the world and continues to witness significant increases in consumption, with a doubling of overall consumption expected by 2030. However, there are serious concerns over the levels of supply required to match this demand.
Alagappan Murugappan, CDC’s Managing Director, Asia Funds said: “Agribusiness is a key sector for CDC, in India and globally because of its job creating potential. Investments to modernise and develop food and agriculture businesses are urgently needed and will have a direct impact on reducing poverty.”