The green lending programme will expand financial assistance to small-scale renewable energy projects in India, rest of Asia and Africa.
On Tuesday, the UK-based development finance institution British International Investment (BII) announced that it has pledged $75 million (approximately Rs 625 crore) to Symbiotics Investments for their second green basket bond.
According to BII’s official statement, this initiative is part of a green lending project. This project aims to boost funding for small-scale environmental projects in Africa, South Asia, and Southeast Asia through Micro, Small, and Medium Enterprises (MSME) lenders, with half of the funds designated for India.
Furthermore, the initiative will assist an additional 10-15 MSME lenders who need less investment capital than BII usually provides directly. The initial green basket bond did not cover them, which supported 11 MSME lenders across various countries, including India, Vietnam, Cambodia, Tunisia, Botswana, Kenya, Bangladesh, and Nepal.
BII’s Technical Assistance facility will also provide more than $460,000 to enhance the additional MSME lenders’ climate financing knowledge and capabilities.
The company also stated that this funding initiative will support a variety of green projects similar to the first Green Basket bond issued in 2022.
These encompass renewable energy, energy efficiency improvements, clean transportation initiatives, sustainable building developments, agricultural innovations, forestry conservation efforts, and other environmentally beneficial initiatives.
Samir Abhyankar, BII Managing Director and Head of Financial Services Group, expressed that this partnership focuses on empowering smaller financial institutions and promoting sustainable development in climate-sensitive regions.
Yvan Renaud, CEO of Symbiotics Investments, expressed the hope that the second green basket bond would stimulate capital mobilisation for similar projects crucial in effectively addressing climate change and its impacts.
Reports see this initiative as a significant step amidst escalating concerns over global climate change. India is facing vulnerability to extreme weather and rising sea levels, necessitating substantial investment in green projects. However, many small and medium-sized green enterprises struggle to secure financing, contributing to a staggering estimated funding gap of $530 billion in the country.
The introduction of the Green Basket Bond aims to bridge this divide by providing essential capital to support green businesses and initiatives, thereby accelerating India’s progress towards sustainability goals.
