Luxembourg, July 12, 2019

AIIB Approves On-Lending Facility to Support Renewable Energy in India

The Asian Infrastructure Investment Bank’s (AIIB) latest project will increase the supply of renewable energy in India by mobilizing private capital. The project provides a USD100-million loan to L&T Infrastructure Finance Company Limited (LTIF), a subsidiary of L&T Finance Holdings Ltd and a leading non-bank financier of renewable energy in India. The financing marks AIIB’s first loan to a non-banking finance company (NBFC).

The loan proceeds will be used to on-lend to wind and solar power infrastructure projects throughout India. The loan mobilizes private capital from sponsors, other financiers and LTIF’s own sources.

India is committed to reducing its carbon intensity by 30 to 35 percent of 2005 levels by 2030 under the Paris Agreement. The country will need to increase the share of non-fossil fuels in its energy mix if it is to achieve this target. Investment in renewable energy is an efficient way for India to reduce its carbon intensity while meeting its growing energy needs. NBFCs play a crucial role in broadening access to financial services, enhancing competition and diversity in the financial sector, and has emerged as key financiers of renewable energy.

“AIIB’s financing will help secure the funding supply for renewable energy project development in India,” said AIIB Vice President and Chief Investment Officer D.J. Pandian. “The project supports AIIB’s commitment to sustainable energy for Asia to reduce the carbon intensity of energy supply.”

LTIF’s collaboration with AIIB will also help the company develop its environmental and social capabilities which will in the future enable it to tap the international market for green finance.

Additional information about the project can be found here.

About AIIB

The Asian Infrastructure Investment Bank (AIIB) is a multilateral development bank with a mission to improve social and economic outcomes in Asia. Headquartered in Beijing, we began operations in January 2016 and have now grown to 97 approved members worldwide. By investing in sustainable infrastructure and other productive sectors in Asia and beyond, we will better connect people, services and markets that over time will impact the lives of billions and build a better future.

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