As Panchabuta had reported earlier last month, the World Bank Group arm, International Finance Corporation (IFC) has set its eyes on the ‘green’ projects in India especially focusing on Gujarat and Rajasthan. The international financing organization has identified potential investment areas under solar power, wind energy and gas-based energy for its upcoming funding plans.
A couple of days ago, Panchabuta had reported that IFC was planning to lend $50 Mn to PTC India Financial Services for funding Renewable Energy projects.
According to this report, World Bank and International Finance Corporation (IFC), will double loans given to renewable energy projects to $2 billion (Rs9,103 crore) in the next three years in India. The report further adds that, the lending will primarily be for power generation and energy efficiency projects. The World Bank largely funds government projects while the IFC caters to the private sector.
Ashish Khanna, senior energy specialist, South Asia Sustainable Development, World Bank, said that in the short run, biomass and small hydro projects will be most viable in the green energy space. “Later on, big hydro and solar projects can also help in a big way. Solar technologies will first stabilise in urban areas and then move to villages,” he added.
Interesting to note that a couple of days back Panchabuta had talked about the view of Mr. Raja Parthasarathy, MD, IDFC PE who has also mentioned that the cleantech theme will broadly be investments in clean energy in the short term and this investment thesis of IFC also seems to be along the same lines.
Further according to that report,Khanna also said the two international funding bodies were in talks with the government for an initiative to fund and assist financial institutions in setting up arms dedicated to renewable energy sector lending.
Panchabuta understands that one of those institutions could be the Japan Bank for International Cooperation (JBIC) that is looking at providing equity funding to private sector projects in India instead of debt support for public sector entities. The JBIC has earlier talked about intention to create a green investment fund not limited to India but mainly for India, with other partners such as the International Finance Corporation.