The International Finance Corporation, the private sector arm of the World Bank Group, will invest $15 million in a foreign currency convertible bond issued by Ballarpur Industries Limited, India 's largest producer of writing and printing paper. The total value of the bond is $45 million.

This is IFC's first-ever bond of this type in India.

IFC's investment will help BILT finance its ongoing investment needs and transform itself into a world-class, environmentally compliant paper company that can compete in the domestic and international markets.

BILT's plans include modernisation and expansion of its production capacity, environmental improvements and expansion of the company's farm forestry program.

"IFC's participation in this venture will help BILT strengthen its global competitiveness and to deal proactively with the growing domestic demand for paper," said Richard Ranken, director of IFC's Global Manufacturing Services department.

"Contributing to sustainable farm forestry will have an impact on the welfare of the local communities in areas where the company operates and provide additional income for subsistence farmers."

An existing IFC client, BILT was established in 1945 and is the flagship company of the L M Thapar group. It has an installed capacity of 340,000 tons of paper per annum and a pulping capacity of about 320,000 tons per annum.

"Our successful placement of FCCBs, together with the overwhelming response to our global depositary share issue, clearly reflects support for the company's business strategy on the part of discerning global investors," said Gautam Thapar, vice chairman and managing director of BILT.

"Participation in this important financing will strengthen our already long-standing partnerships with IFC and other international financial institutions."

The IFC aims to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people's  lives.

IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. 

From its founding in1956 through 2003, IFC has committed more than $37 billion of its own funds and arranged $22 billion in syndications for 2,990 companies in 140 developing countries.