Indian Infrastructure Equipment Limited The project consists of establishing an infrastructure equipment services company, IIEL,  that would provide infrastructure equipment to contractors on a usage basis, thus allowing the contractor to focus on core competencies (construction and project management) while obtaining access to infrastructure equipment without investing capital. The company will be the first  nation-wide infrastructure equipment services company in India. The IIEL project is expected to further accelerate the process of mechanisation in the Indian infrastructure construction sector by providing contractors an alternative way of accessing high-quality and expensive equipment. Increased mechanisation will, in turn, have a strong bearing on improving the quality of infrastructure construction, better maintenance, and reduced delays in infrastructure project implementation. As an infrastructure-enabling service company, IIELs initial business focus will be on supplying specialised equipment for the road sector, multiple-use equipment for construction of roads, irrigation, dams, and pipelines, and high-value general-purpose equipment. Specialised equipment is expected to be rented by medium-sized and large contractors for short periods.  General-purpose equipment is expected to be rented by medium-sized and large contractors as back up during project peak loads or equipment breakdowns, and by small and medium-sized contractors who intend to bid for larger projects but are restricted because of capital constraints.    The project is highly innovative and timely in the Indian market and is expected to pioneer the Indian infrastructure equipment rental sector.  Realising the importance of the infrastructure sector in fuelling future economic growth, over the last five years, the Indian government has increased its focus on modernising and upgrading the infrastructure sector (including urging the contractors to use more sophisticated and suitable infrastructure equipment by inserting minimum equipment specifications and requirements in documents inviting bids). Over the same period, several equipment manufacturers have either acquired or established manufacturing units in India. The availability of locally manufactured or assembled infrastructure construction equipment combined with an increasing investment volume in the infrastructure sector are key factors in making the project concept attractive in India.    IFC has played a pivotal role in helping IIEL develop and structure a sound and comprehensive environmental management system (EMS). The EMS would comprise innovative features such as the establishment of an environmental advisory board (EAB) to ensure that IIEL equipment is not provided to projects which do not meet minimum environmental criteria. The EAB would comprise of independent environmental specialists who can inform IIEL management on controversial projects and give advise on how to handle potential environmental issues. IIELs adoption and use of the EMS is expected to have a strong demonstration effect in terms of encouraging Indian contractors and project promoters to focus on better environmental practices. Contractors and project promoters who are less stringent on environmental requirements, would have to rely on more expensive financing methods to get access to the equipment, which could result in higher project costs and/or non-competitive bids.    IFC has also played a significant advisory role in helping the sponsors refine and elaborate the project concept, develop a robust financial structure, and identify and structure risk mitigation mechanisms. Moreover, IFC has actively assisted IIEL in its efforts to sell the project concept to other international financial institutions. IFCs presence as an investor will further help IIEL attract other investors and sources of funding.