According to reports, giving a further boost to renewable energy sector in the country, European Investment Bank (EIB) has sanctioned a credit of 200 million Euros to Indian Renewable Energy Development Agency Limited (IREDA) for financing renewable and energy efficiency projects.
Through this, IREDA, a dedicated financing arm of the Ministry of New and Renewable Energy (MNRE), will finance existing and new projects of renewable energy in India.
“EIB has sanctioned a Line of Credit (LoC) of Euro 200 million to Indian Renewable Energy Development Agency to be utilised for financing renewable energy and energy efficiency projects in India,” an MNRE statement issued today said.
It said that the total loan period is of 20 years and the LoC has been secured by a sovereign guarantee from the Indian government.
The agreement signed today supports the government’s focus on a low carbon growth strategy for power generation in India, the statement added.
The agreement for availing the LoC was signed by Chairman and Managing Director, IREDA Debashish Majumdar and Magdalena EIB vice president, Alvarez Arza in the capital in the presence of MNRE Minister Farooq Abdullah.
Arza said that the bank started funding Indian project in 1993 and in this period of two decades, India has now become the second largest recipient of EIB fund.
The statement said that the government in order to tackle the twin problems of widening power deficits and mounting carbon emissions, has set ambitious goals to increasingly displace fossil fuels with renewable sources.
Developing renewable energy sources not only helps address environmental concerns, but also improves energy security and spurs regional economic development, it said.
This LOC of Euro 200 million will facilitate in IREDA’s financing of existing and new projects of renewable energy, Satish B Agnihotri, Secretary, MNRE said.
IREDA has cumulatively financed over 2000 projects corresponding to a financial value of about Rs 22,500 crores and it has been raising resources from various bilateral and multilateral agencies as well as domestic sources through both taxable and tax-free bonds.