May 21, 2018 / 1:13 PM / 5 months ago

UPDATE 1-Russia sovereign wealth fund calls for increase in state debt

(Adds details, quotes, context)

MOSCOW, May 21 (Reuters) - The head of Russia’s $10 billion sovereign wealth fund called on Monday for the government to issue more domestic debt to fund infrastructure projects.

“The level of domestic debt is insignificant now. It is far lower than in other countries,” Kirill Dmitriev, who heads the Russian Direct Investment Fund (RDIF), told a media conference call on Monday organised ahead of the St Petersburg Economic forum, an annual business gathering.

“If these funds are invested in lucrative infrastructure projects, it would contribute to additional growth,” he said.

RDIF leverages its own capital by investing in partnership with foreign funds. It will meet with President Vladimir Putin during the economic forum this week along with the heads of around 40 other investment funds from 20 countries which manage more than $13.5 trillion in assets.

Russia will need to spend at least 8 trillion roubles ($130 billion) over the next six years to meet economic goals set in new decrees that Putin signed after being sworn into the presidency at the start of May.

RDIF and its foreign partners plan to invest 1.5 trillion roubles ($24 billion) in the next two years. They have previously invested 1.2 trillion roubles in more than 50 projects, Dmitriev said.

During the St Petersburg forum, RDIF plans to announce more than 10 projects for hundreds of million dollars with investment from France, Japan and Saudi Arabia in infrastructure, agriculture, chemicals and medicine.

The project with Saudi Arabia will be the first through a new joint fund set up with the kingdom. RDIF also plans to discuss ways to increase Saudi investment in Russia with Saudi Arabia’s Energy Minister Khalid al-Falih during the forum. ($1 = 62.2504 roubles) (Reporting by Polina Devitt Writing by Katya Golubkova Editing by Peter Graff)

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