In a bid to further strengthen India’s commitment towards its Nationally Determined Contribution (NDCs) targets, adopted under the Paris Agreement, and attract global and domestic investments in eligible green projects, Union Minister for Finance & Corporate Affairs, Nirmala Sitharaman has approved the final Sovereign Green Bonds framework of India. The proceeds generated from issuance of such bonds will be deployed in Public Sector projects which help in reducing carbon intensity of the economy. Through these, the Government plans to mobilise Rs 16,000 crore during the second half of the current financial year.
The Framework comes close on the footsteps of India’s commitments under ‘Panchamrit’ as elucidated by the Prime Minister, Shri Narendra Modi, at COP26 at Glasgow in November, 2021. The approval is fulfillment of the announcement in the Union Budget FY 2022-23 by the Union Finance Minister that Sovereign Green Bonds will be issued for mobilising resources for green projects.
India’s first Sovereign Green Bonds framework was formulated, and as per the provisions of the framework, Green Finance Working Committee (GFWC) was constituted to validate key decisions on issuance of Sovereign Green Bonds.
Further, CICERO, an independent and globally renowned Norway-based Second Party Opinion (SPO) provider, was appointed to evaluate India’s green bonds framework and certify alignment of the framework with ICMA’s Green Bond Principles and international best practices. CICERO has rated India’s Green Bonds Framework as ‘Medium Green’ with a ‘Good’ governance score.