ADB and GCF Partner to Launch Clean Energy Financing Program in India
The Green Climate Fund (GCF) has approved $200 million for a new Asian Development Bank (ADB)-led program which aims to unlock large-scale public and private investment in high-impact and emerging clean energy sectors in India.
The concessional funding will support ADB’s India Green Finance Facility (IGFF), a pioneering blended finance program that aims to crowd-in investment in emerging clean energy technologies from India’s leading development finance institutions (DFIs) and from the private sector.
Through this facility, ADB will seek to support lines of credit with qualifying national DFIs, which will be responsible for developing the pipeline of projects.
“This is a significant milestone in helping India transform its energy systems to meet its net zero emission target by 2070. While India has made tremendous progress in scaling up wind and solar energy, it is now seeking to decarbonize hard to abate sectors such as industry, agriculture, and transportation,” said ADB Director for Energy Transition Pradeep Tharakan.
As ADB’s first partnership with the GCF in India, the IGFF will catalyze the uptake of emerging clean technologies across India and strengthen the ability of the nation’s financial institutions to scale up climate action.
Using GCF and ADB resources, the IGFF will extend lines of credit to India’s leading DFIs to accelerate funding for technologies such as round-the-clock renewable energy, green hydrogen, compressed biogas, electric transport in rural areas and decentralized renewable energy solutions.
A central innovation of the IGFF is the creation of a $65-million risk sharing facility. This will provide partial credit guarantees to help smaller developers access affordable finance for compressed biogas projects which commercial lenders often overlook due to inherent risks.
The IGFF creates a blueprint for how concessional finance can catalyze sustained, market-driven transformation in developing countries.
“The GCF is proud to support IGFF. This partnership reflects our commitment to driving innovative, high-impact solutions that tackle climate change and promote inclusive, sustainable development,” said GCF Director for Asia and Pacific Hemant Mandal.
GCF, the world’s largest climate fund, approved the funding at its 42nd Board meeting on 1 July.
ADB is a leading multilateral development bank supporting inclusive, resilient, and sustainable growth across Asia and the Pacific. Working with its members and partners to solve complex challenges together, ADB harnesses innovative financial tools and strategic partnerships to transform lives, build quality infrastructure, and safeguard our planet. Founded in 1966, ADB is owned by 69 members—50 from the region.
This article has been republished from The Asian Development Bank.