<?xml version="1.0" encoding="UTF-8"?><root available-locales="en_US," default-locale="en_US"><static-content language-id="en_US"><![CDATA[<p>Life Insurance Corp (LIC) and Infrastructure Leasing and Financial Services (IL&FS) on Friday signed a pact to set up a debt fund with a corpus of $2 billion to finance infrastructure projects in Asia's third-largest economy.<br><br>IL&FS Financial Services Ltd, the investment banking arm of IL&FS, plans to initially raise $1 billion from international as well as domestic investors for the fund, the company said in a statement.<br><br>State-run LIC will contribute up to 10 per cent of the total corpus and the rest would be raised by IL&FS Financial Services in a phased manner, said an IL&FS official, declining to be named as he was not authorised to speak to the media.<br><br>Finance Minister Pranab Mukherjee announced in February 2011 the setting up of infrastructure debt funds to source long-term debt from both foreign and domestic investors in his budget speech for the last fiscal year.<br><br>India has pledged to spend $1 trillion on upgrading its creaking power plants, railways and ports in the five years to 2017 to deal with a key bottleneck to continued growth. Private cash has been pencilled in for half of that.<br><br>India Infrastructure Finance Company said in December it planned to launch a $1 billion infrastructure debt fund.<br><br><br>(Reuters)</p>