DUBAI (AFP) - Dubai said Thursday it would inject 9.5 billion dollars into Dubai World, which announced it was asking creditors to wait for up to eight years to be repaid in full. The firm which has been wrangling for months with creditors, said it was issuing two tranches of new debt that would mature in 5 years and eight years. The announcements, which stated that Dubai Worlds troubled Nakheel real estate subsidiary will get some $8b out of the governments earmarked aid, helped the emirates main stock market index to a 4.31pc rise. Creditors, apart from the govts financial support fund which has pumped cash into Dubai World, will receive 100pc principal repayment through the issuance of two tranches of new debt with five and eight years maturities, the company said in a statement. It said that the negotiated debt owed to creditors by Dubai World Company amounts to $14.2b, implying that the remainder of its total liabilities of $23.5b as of Dec 31, 2009 are owed to the govt. Company officials said that the figure excludes debt owed by Nakheel because the government intends to separate the troubled subsidiary from Dubai World. Nakheel will cease to be a subsidiary of Dubai World and will become a directly-held subsidiary of the government, so the government will end up owning 100 percent, Dubai Worlds chief restructuring officer Aiden Birkett told reporters. He said that the current cash injection into Nakheel, as well as money pumped in over the past 12 months, would be converted into shares of the real estate firm that is behind iconic Dubai projects like the man-made palm-shaped island and The World a cluster of islands resembling the world map. In Dubai World, the government will also convert its financial support of 8.9 billion dollars into equity, the company said. In addition, the government will undertake a $1.5b injection into Dubai World to fund the companys working capital and interest payment commitments that will arise from the new debt facilities, the firm added. The government will support Dubai Worlds restructuring proposals with significant financial resources, the head of the emirates Supreme Fiscal Council, Sheikh Ahmed bin Saeed al-Maktoum, said in a statement. These resources include a commitment to fund up to 9.5 billion dollars in new funding over the business plan period, he added. Dubai will fund the new aid package using 5.7 billion dollars remaining from a 10-billion-dollar loan made available by neighbouring Abu Dhabi to repay 4.1 billion dollars of maturing bonds owed by Nakheel in December, and will use internal government resources, Sheikh Ahmed said. This proposal represents the best possible solution for all stakeholders, Birkett said in a statement. He told reporters that the initial reaction from creditors who received the proposal on Wednesday was positive, but said negotiations with the 96 lenders will take weeks. Dubai rocked global financial markets in late Nov when it said it might need to freeze debt payments by its largest conglomerate Dubai World, stoking fears of a state default over sovereign debt. In Dec , Dubai World began negotiations with creditors to restructure its debt. In a separate statement Thursday, Nakheel said it will repay its debts, but without giving a figure on the amount. Islamic Sukuk bonds will be paid as they mature in 2010 and 2011, while secured bank creditors will get 100pc of the principal in addition to accrued interest, it said. Birkett said total government aid to Dubai World and Nakheel will reach 20 billion dollars by the time were finished with restructuring. Dubai borrowed heavily during its boom years before the global economic downturn, fuelling its rapid growth into a regional trade, tourism and IT hub. Dubai Worlds total debt, including liabilities, is around $60b. The emirates debt is estimated at between 80 and 100 billion dollars, but some analysts say it could be as high as 170b. Dubai World is a state-run conglomerate of 10 firms including Nakheel and the worlds third-largest ports operator, DP World.