REC Limited, one of the prime state-owned entities in India, has just closed a landmark deal of its kind with Deutsche Bank AG, GIFT City branch, about a green loan. It was for providing a JPY 31.96 billion loan, approximately USD 200 million, for projects duly conforming to strict environmental standards and thereby helping to foster renewable energy adoption across the country.
This initiative is impressive not only in its amount but also as one of the pioneering Japanese yen-denominated green loans arranged by Deutsche Bank AG, whose proceeds will be deployed toward projects in emission reduction and making development more sustainable across the country.
On his part, CMD, REC Limited, Vivek Kumar Dewangan added that this transaction aligned very well with the strategic goals of REC toward building capacities in green energy financing. He underlined the importance of this milestone toward pushing sustainable development projects in India further ahead into the future and how it could pave through even more collaborations in the future in the green finance sector.
Deutsche Bank Group CEO, India, Kaushik Shaparia, said that his bank would home in on green initiatives through the form of sustainable financing. He explained that Deutsche Bank had gathered experience in green financing and was fully dedicated to the process of helping its clients manage their transition toward a carbon-neutral future.
REC Limited has been aggressively funding key projects; a good chunk of its loans in the last fiscal went to renewable energy projects. Out of ₹3.59 trillion of total sanctioned loans, ₹1.36 trillion was towards renewable projects. Likely, state-owned firm REC aims to increase the loan portfolio in renewable energy to 30 percent from 10 percent as it stands today.
The collaboration of REC Limited and Deutsche Bank AG is simply a reflection of the prevailing global trends toward reducing climate change through healthy economic development. This will, therefore, not only enhance the securing of a position by REC in green energy but also set precedence for future financial collaborations so that the ambitious sustainability goals advanced by India are attained.
Finally, the signing of the deal of the JPY 31.96 billion green loans by REC with Deutsche Bank AG is another huge step toward the cause of financing sustainable projects in India. This transaction reflects more or less the critical role of financial institutions in driving the right kind of environmental outcomes and has supported this nation’s ‘green growth’ agenda through its call to service in contributors driven toward stewardship of the environment and renewable energy.