The loan is to support sustainable infrastructure projects aligned with the India’s climate commitments
FinTech BizNews Service
Mumbai, 23 December, 2024: The Government of India and the Asian Development Bank (ADB) signed a $500 million loan to support green and sustainable infrastructure projects aligned with the country’s climate commitments on 20th December 2024. The ADB loan, with a sovereign guarantee, will be extended to the India Infrastructure Finance Company Limited (IIFCL).
The signatories to the Financing Environmentally Sustainable Growth in Infrastructure Project were Ms. Juhi Mukherjee Joint Secretary, Department of Economic Affairs, Ministry of Finance, for the Government of India, and Country Director Mio Oka for ADB.
“ADB financing will help IIFCL provide long-term capital for infrastructure projects focusing on connectivity and energy transition as well as under-resourced sectors like urban projects, education, and health care,” said Ms. Oka.
To meet its net-zero commitments, the country needs immense private capital investment that will require innovative financing platforms and risk-mitigation instruments to address inherent sector risks and market asymmetries. As a strategic development finance institution, IIFCL is well-suited to meet these needs.
ADB has worked closely with IIFCL over the years to develop its operational and risk management capacities. As IIFCL has developed and evolved, its operations are increasingly geared toward leveraging private sector resources that necessitate the expansion of its product offerings for potential institutional investors.
The project will build the institutional capacity of IIFCL to integrate green and best practices into the infrastructure projects. A sustainability unit and an environmental sustainability framework and scoring method to assess the sustainability rating of the projects will also be established.
