In a significant move towards boosting renewable energy initiatives in India, the Indian Renewable Energy Development Agency Ltd. (IREDA) has forged a Memorandum of Understanding (MoU) with India Infrastructure Finance Company Ltd (IIFCL). This pivotal agreement paves the way for the co-lending, co-origination, and loan syndication of renewable energy projects, encompassing Small Hydro projects as well.
Signed on September 4, 2023, by Shri Pradip Kumar Das, Chairman & Managing Director of IREDA, and Shri P R Jaishankar, Managing Director of IIFCL, the MoU carries substantial implications for the nation’s renewable energy landscape. Notably, it envisions the establishment of fixed interest rates for IREDA’s borrowings spanning a period of three to four years. Additionally, IIFCL may opt to invest in bonds issued by IREDA in accordance with the stipulated terms and conditions.
Expressing his thoughts on the occasion, CMD of IREDA highlighted the strategic partnership’s significance, asserting their commitment to leveraging techno-financial expertise to propel the renewable energy sector’s growth. He emphasized that this collaboration aligns perfectly with the Indian government’s ambitious target of achieving a 50% share of non-fossil fuels in the nation’s energy mix by 2030. In doing so, they aim to contribute to Prime Minister Shri Narendra Modi’s vision of an ‘Aatmanirbhar Bharat’ (self-reliant India) and a cleaner, greener future.
IREDA, a Public Sector Undertaking (PSU) operating under the Ministry of New & Renewable Energy (MNRE), had established a specialized Business Development and Consultancy division two years ago, anticipating the growing demand within the renewable energy sector. Over time, IREDA has inked MoUs with various central and state agencies. This newly-forged MoU with IIFCL is expected to synergize the green financing prowess of IREDA with IIFCL’s expertise in infrastructure financing.
It is worth noting that IIFCL, a wholly-owned Government of India company established in 2006, is dedicated to offering long-term financial support to viable infrastructure projects. This collaboration marks a significant step toward accelerating India’s transition to renewable energy sources and underscores the government’s commitment to sustainable and eco-friendly energy solutions.