IFFCO-Tokio Unveils Surety Bond Insurance to Boost India's Infrastructure Efforts

IFFCO-Tokio General Insurance has launched Surety Bond Insurance, aimed at providing a vital risk mitigation solution to support India's growing infrastructure sector. This innovative offering is designed to assist contractors involved in large-scale Public-Private Partnership (PPP) projects, which are crucial to the country's development plans.

The Insurance Regulatory and Development Authority of India's (IRDAI) decision to allow general insurers to issue surety bonds, as of April 2022, paved the way for this initiative. These surety bonds act as legally binding tripartite agreements, offering protection against the risks associated with infrastructure projects.

According to IFFCO-Tokio General Insurance MD and CEO, Subrata Mondal, these bonds ease the financial burden on contractors by ensuring compliance with India's bidding processes, ultimately enabling more effective project execution. The construction industry, which has provided bank guarantees totaling Rs 1.70 lakh crore, anticipates this figure to reach Rs 3 lakh crore by 2030.

(With inputs from agencies.)