Indian Renewable Energy Development Agency (IREDA) has signed a Facility Agreement with State Bank of India, Tokyo Branch to raise External Commercial Borrowing (ECB) of JPY 26 billion (approximately ₹1,500 crore). The Green Shoe Option of a further value of JPY 10 billion has also been included in the agreement, reiterating IREDA’s strong commitment towards facilitating India’s transition to cleaner energy.
IREDA’s Strategic Financial Move
The unsecured facility of five years will be repaid in a single bullet payment on maturity, which will ensure healthy debt management. The cost of borrowing is likely to be below 7 percent, and it will offer an economic alternative against comparable domestic borrowings.
IREDA CMD Pradip Kumar Das said, “This unit enables us to diversify the resource base and reduce costs, enhancing our lending activities to the renewable energy sector in India. The transaction reflects the high confidence of global investors in IREDA’s growth prospects and financial health.”
Strengthening India’s Green Energy Push
The amount will be invested to finance renewable energy projects in India, which again aligns with India’s non-fossil fuel capacity goal of 500 GW by 2030. IREDA is a prominent financier in the renewable space and initiates green energy projects, like solar, wind, hydro, and bioenergy.
By facilitating international funds at reasonable rates, IREDA is becoming the preferred green finance facility. The move will facilitate developers and investors of renewable energy projects to get access to low-cost capital at cheap interest rates, quicker steps toward making India a carbon-free country.
Improved Confidence Globally in Financial Stability of IREDA
Successful completion of this ECB transaction reflects confidence of foreign investors in IREDA’s sound finances and potential of India’s renewable energy sector. Since India is now fast emerging as a clean energy deployment leader, IREDA’s channeling of foreign funds will play an important role in fulfilling the financial deficit of the green scheme.
