AIIB Invests In Eight Solar Projects Of 1.54 GW With Mahindra Susten

AIIB Invests In Eight Solar Projects Of 1.54 GW With Mahindra Susten

The Asian Infrastructure Investment Bank (AIIB) a multilateral development bank has invested Rs 4.86 billion (around USD $58.4 million equivalent) in renewable energy Infrastructure Investment Trust (InvIT).

InvIT (Sustainable Energy Infra Trust or SEIT), has eight operating solar power generation assets of 1.54 gigawatt (GW)-peak total capacity located in India. SEIT is co-sponsored by Mahindra Susten Private Limited, an renewable energy platform of Indian multinational conglomerates (the Mahindra Group) and Ontario Teachers’ Pension Plan, a leading global institutional investor.

AIIB aims to support the development of InvITs as an infrastructure asset class in India. The successful listing of SEIT contributes to the capital-raising track record. 

By supporting the formation of SEIT, the sponsors are estimated to have a channel to monetize investments in revenue-generating infrastructure assets. It is expected to free up the much-needed capital to undertake their growth plan to develop new renewable energy assets. Support from multilateral development banks like AIIB is estimated to strengthen investors’ awareness of the asset class and comfort level. This is necessary for channeling broader sources of institutional capital and domestic retail savings to the infrastructure industry and scaling up such monetization tools.

“This demonstrates AIIB’s continued support for innovative infrastructure financing solutions, promoting green infrastructure and mobilizing private capital to deepen the breadth of financing availability to our member’s infrastructure sector and to support their commitment in achieving Net Zero targets,” said AIIB Director General (Banking Department, Region 1) Dongik Lee.

He added, “The increasing power demand in emerging markets calls for broader private sector participation to finance growth renewable energy. AIIB continues to embark on strategic partnerships in the ecosystem to catalyze the growth of the infrastructure asset class.”

This project is AIIB’s second investment in InvITs in India, following a June 2019 investment of approximately USD50 million in Oriental Structural Engineers InvIT, the objective of which is to mobilize long-term private institutional capital for financing of roads and highways in India.