ADB Approves $500 Million Loan to Strengthen India’s Sustainable Infrastructure.

The Asian Development Bank (ADB) has approved a $500 million loan to bolster India’s economic growth through the promotion of environmentally sustainable infrastructure. The loan, which carries a sovereign guarantee, will be provided to India Infrastructure Finance Company Limited (IIFCL) to fund infrastructure projects focusing on connectivity, energy transition, and under-resourced sectors such as urban development, education, and healthcare.

The financing, part of the “Financing Environmentally Sustainable Growth in Infrastructure Project,” will enhance IIFCL’s capacity to integrate green practices and sustainability into infrastructure development. This includes establishing a sustainability unit, an environmental sustainability framework, and a project scoring system to assess sustainability ratings.

India, one of the countries most affected by climate change, faces growing environmental challenges, such as floods, droughts, and cyclones, which necessitate infrastructure projects designed to mitigate these risks. Despite the pressing need, there is a significant financing gap, with an estimated $1 trillion required for climate-related projects that the public sector alone cannot meet.

“India’s economy is one of the fastest growing in the world. Critical to this growth are robust infrastructure projects that align with the country’s climate commitments,” said Sanjeev Kaushik, ADB’s Principal Finance Sector Specialist. “ADB is increasing its support to ensure that India’s development is both inclusive and sustainable.”

The project will help attract private sector investment and create opportunities for risk-sharing mechanisms to fund infrastructure projects that address climate challenges.

HBL