The Reserve Bank of India (RBI) has announced plans to issue Rs 200 billion in sovereign green bonds in four equal tranches during the second half of fiscal year 2024-25.
These bonds aim to support projects in sectors such as climate change, clean transportation, renewable energy, and sustainable water and waste management. The first tranche, amounting to Rs 50 billion with a 10-year tenor, will open for subscription from November 25 to 29, 2024. The second tranche, also for USD592 million, will have a 30-year tenor and will be available for subscription from December 9 to 13, 2024. The third tranche, with a 10-year tenor, will be offered from January 27 to 31, 2025. The fourth tranche, with a 30-year tenor, will be available from February 17 to 21, 2025.
Furthermore, the RBI may exercise a greenshoe option of up to Rs 20 billion for each of these auctions. Non-Resident Indians will reportedly be allowed to invest in sovereign green bonds with 10-year tenors via the International Financial Services Centre at GIFT City in Gandhinagar, Gujarat. The funds raised through these bonds will reportedly be deployed in public sector projects aimed at reducing the economy’s carbon intensity. The government has outlined nine sectors for investment, including renewable energy, pollution control, and sustainable infrastructure. Additionally, the Securities and Exchange Board of India has updated its regulatory framework for green debt securities to address growing corporate interest. The regulations also extend to yellow bonds, specifically targeting solar energy generation and its associated industries.