The Japan Bank for International Cooperation (JBIC; Governor: HAYASHI Nobumitsu) signed on August 7 a loan agreement amounting to up to JPY25.5 billion, of which JBIC’s portion is JPY13.5 billion, with Power Finance Corporation Limited (PFC), a government financial institution in India. The loan is based on the credit line that JBIC signed with PFC in July 2022 for renewable energy projects and energy efficient power generation and heat supply projects*1. The loan is co-financed with Sumitomo Mitsui Banking Corporation, the Bank of Yokohama, Ltd., the Shiga Bank, Ltd., and the Bank of Fukuoka, Ltd. JBIC will also provide a guarantee for the portion co-financed by the private financial institutions.
The loan is extended as part of JBIC’s GREEN operations*2 and is intended to provide the Indian company Ostro Kannada Power Private Limited (OKPPL) through PFC with the funds necessary for a wind farm project in the state of Karnataka, India*3.
The economic growth rate is high in India, but the country relies heavily on coal for power generation sources, with nearly 80% of its energy demand being met by fossil fuels. Given this, Prime Minister Modi pledged in August 2021 that India would become energy independent by 2047, the centenary of the country’s independence, as part of the Self-Reliant India campaign. Also, at COP26 in November 2021, he committed to, among other things, boosting the non-fossil energy capacity to 500GW by 2030. With the loan, JBIC supports the government of India’s initiatives that contribute toward global environmental preservation.
As Japan’s policy-based financial institution, JBIC will continue to financially support initiatives for sustainable development, including global environmental preservation efforts, through collaboration with such overseas government institutions by drawing on its various financial facilities and schemes and by performing its risk-assuming function.
