Sovereign, pension funds can bankroll green projects: govt
800,000-1mn
NEW DELHI: India is in talks with a host of global sovereign funds as well as international pension and insurance funds to fund its renewable energy plans and part-fund the massive $300 billion-plus commitments received from domestic and international companies for setting up of renewable energy projects in the country.
Government officials said meetings with funds and financial institutions have been lined up over the next two days on the sidelines of the RE-Invest meet.
Power, coal and renewable energy minister Piyush Goyal said, “We are talking to most global investors including (sovereign and pension) funds to provide long-term financing to renewable energy projects in India.”
“I was assured by investors in Davos (World Economic Forum) that money is waiting...what investors need is stable policy and fast approvals which is our government’s area of thrust.”
“In India, the manufacturing sector cannot grow without renewable energy...with the aim of 100,000 mw of solar power, 20,000 mw a year is possible target especially in countries like ours, where urbanisation is happening,” said Amitabh Kant, secretary, department of industrial policy and promotion .
While committing `75,000 crore for 15000 mw of solar and wind projects, chairperson of State Bank of India, Arundhati Bhattacharya urged the government to ensure policy checks and other approvals.
“In 2008, bankers lent big money to the bullish power sector little realising that we will be saddled with bad loans as projects got saddled in fuel and policy issues,” she commented.
SBI has a loan exposure of `1.78 lakh crore in the power sector of which `7,500 crore is in clean energy projects.
HSBC country head Naina Lal Kidwai spoke on the need to include credit enhancement schemes such as equity from capital markets, private fund managers besides engaging with foreign funding agencies.
Indian Bank CMD T M Bhasin and Exim Bank CMD Yaduvendra Mathur said inclusion of renewable energy in the priority sector category would help in easy financing.
As per RBI norms, 40% of banks’ total lendings should be to priority sector category.