India, UK to invest £500 million for clean energy projects

The Dollar Business Bureau

India and the UK on Tuesday agreed to set up clean energy projects with combined investments of £500 million. On Tuesday, UK Chancellor of the Exchequer Philip Hammond who is leading a high-profile trade delegation to India, met Finance Minister Arun Jaitely and expressed commitment to invest in India’s clean energy needs.

In the first phase, the two countries will invest £120 million each in the joint fund. They, however, vow to raise about £500 million.

According to Jaitley, “The Green Growth Equity Fund will be a sub-fund of NIIF. “We have established the NIIF. Our first major step in the fund has been taken and there is going to be a sub-fund. With the NIIF participating in it, this is going to be a Green Growth Equity Fund where both are going to make a contribution of £120 million and this will be financing the energy needs in India,” Jaitley said.

In 2015, India had set up the National Infrastructure and Investment Fund (NIIF) with an investment of Rs.40,000 crore to finance greenfield and brownfield projects.

Addressing the media after the 9th India-UK Financial Dialogue, the Finance Minister said, the announcement of investments will serve as the first beginning for the required funds, aimed at financially supporting the country’s rapidly-growing energy and renewable energy market.

“Progress will be accelerated by starting the process of appointing a fund manager now with early market engagement via the publication of a blueprint with an aim to identify additional and complementary sectors for fund investments,” the joint statement said.

India is currently one of the largest renewable energy holders in the world and probably the largest possessor in the region. With over 244 million Indians with no electricity access and over 8 million households using solar home system and pico-PV, the government has launched an extensive renewable energy programme.

According to a recent report, India and Bangladesh together account for 97% of the renewable energy market in the region.

India will develop adequate renewable energy to power nearly 60% of its households by 2027.