AIIB Sets Aside $75 mn Loan for Renewables Financing in India

AIIB has ramped up its investments in India with a USD 75 million loan to boost private capital investment in renewable energy, power transmission, etc.

The Asian Infrastructure Investment Bank (AIIB) has ramped up its investments in India with total in-country financing now standing at USD 2.9 billion. Two of its most recent projects—approved by AIIB’s Board of Directors in October totalling USD 575 million—are expected to ease congestion in the country’s financial hub i.e. Mumbai and boost private capital investment in renewable energy, power transmission, and water infrastructure.

As part of its firm commitment to financing sustainable infrastructure, the Bank also approved in October a loan of USD75 million to Tata Cleantech Capital Limited (TLLC), a leading financier of renewable energy in India. 

The Tata Cleantech Sustainable Infrastructure On-Lending Facility project aims to increase private capital investment in renewable energy, power transmission, and water infrastructure. The project will increase the provision of affordable and clean power, reduce greenhouse emissions and expand the power’s network reach and capacity. Under the Paris Agreement, the Government of India plans to reduce the country’s carbon intensity by 30-35 percent of 2005 levels.

Additionally, a loan of USD 500 million has been granted to the government of India, in order to fast-track work on Mumbai’s suburban railway network, improving the safety and daily commute of millions of passengers across the city.

“Over the past four years, AIIB’s investments in India have grown exponentially,” said AIIB Vice President and Chief Investment Officer D.J. Pandian. “This is a clear sign of our valuable partnership. AIIB will continue aligning its commitments with the government’s priorities, with the Bank serving as a catalyst to India’s continued development.”

In July, the Beijing-headquartered multi-lateral developmental lender had announced that it will provide USD 100 million in loans to L&T Infrastructure Finance Company for on-lending to green energy (wind and solar power) infrastructure projects in India. “Our latest project will increase the supply of renewable energy in India by mobilising private capital. The loan proceeds of USD 100 million will be used to on-lend to wind and solar power infrastructure projects in India,” AIIB had issued in a statement.