A long-term loan of Rs 1,400 crore, was sanctioned by the European Investment Bank (EIB) to State Bank of India (SBI), for financing mega solar projects in the country.
The loan will support in setting up of five different large scale photo-voltaic solar power projects, worth a total investment of EUR 650 million.
The power projects will contribute to India's National Solar mission and reduce dependence on fossil fuel power generation.
Additionally, four solar power projects, at a generation capacity of 530MW have been identified for the purpose.
State Bank of India, Managing Director, B Sriram, said “This new collaboration between SBI and the EIB will increase investment in large scale solar power generation, across India.”
A close cooperation between technical and financial teams from both the institutions, will ensure that world class projects are developed, said Mr. Sriram.
In addition to financing from Indian banks and project promoters, this sanctioned 20 year long-term EIB loan will enable the funding of individual projects in Tamil Nadu and Telangana.
The loan was announced ahead of the inauguration by Finance Minister Arun Jaitley, EIB President Werner Hoyer and Vice-President Andrew McDowell.
Jaitley, while speaking before inaugurating the Delhi office of the EIB, said this represents the recognition of the strategic depth of the relationship between the European Union and India.
“Both the countries are extremely important global partners in trying to grow and fulfill the aspiration of our people,” said Jaitley.
“ We are also delighted that, EIB is expanding its investments in India.”
“This is one of the largest infrastructure creation programmes, and for the next two decades, I see India will try to expand this infrastructure and get rid of the deficit that existed in India.”
“We require international investment in terms of Foreign direct investment (FDI), and also in terms of investment by various development agencies etc.,” he added.
The EIB at the event, further announced euro 250 million for construction of the Lucknow Metro. This project represents, the second tranche of a total euro 450 million backing for the project.
EIB Vice-President Andrew McDowell, said, investment on a large-scale in renewable power is necessary to strengthen affordable, reliable and sustainable energy.
This new project reflects the shared commitment of India and the EU, to challenge climate change and implement the Paris Climate Agreement, he added.
The EIB is one of the largest lenders in renewable energy investment across the globe. Owned by the 28 member states of the European Union, it is the world's largest international public bank.