India's quasi-sovereign wealth fund, the National Investment and Infrastructure Fund (NIIF), and the Japan Bank for International Cooperation (JBIC) launched on Wednesday a $600-million fund to invest in sustainability projects.

JBIC will contribute 51% of that figure, and India the rest, the Indian government said in a statement.

The India-Japan Fund will target investment in sustainable projects in areas such as renewable energy, e-mobility and waste management, the NIIF, launched in 2015 as India's first state-backed fund, said in a statement.

It will also look to boost collaboration between Indian and Japanese firms amid an "unstable world situation and problems such as a severed supply chain," said Hayashi Nobumitsu, the governor of the Japanese bank.

"Japanese companies are increasingly interested in entering the Indian market as a relocation destination for a production base or an investment destination," he added. (Reporting by Aftab Ahmed; Editing by Sudipto Ganguly and Clarence Fernandez)