MUMBAI:
State Bank of India (SBI) signed loan Agreement with KfW, the German development bank, for $277 mn (~Rs.1,958 Crores) for establishing an Energy Efficient Housing Program in India. This facility has been signed based on an agreement on Financial Cooperation between the Government of India and the Government of the Federal Republic of Germany signed in October 2019. The Program shall be a part of the Indo-German Development Co-operation, guided by the 2030 Agenda for Sustainable Development.
Under the Program, both builders and home buyers shall be financed for developing/ purchasing energy efficient residential projects that achieve at least 25% energy savings in comparison to standard reference buildings. Hence, this Program will contribute to India’s policy framework towards energy conservation in the residential building sector and reduction in greenhouse gas emissions.
In addition to the $277 mn loan facility, KfW shall also extend a grant of €1.5 mn to SBI as a technical assistance package. The technical assistance funds shall be used for supporting SBI in the preparation, implementation and monitoring of the program. Further, an investment grant of €10 mn has also been provided for incentivising builders to develop housing projects that achieve significantly higher levels of energy savings vis-à-vis standard reference buildings (i.e. at least 40% savings).
The arrangement of the loan and the grant facilities was facilitated by SBI’s investment banking subsidiary, SBI Capital Markets Limited.
