India’s focus on renewables has pushed green bond sales to a record high of $3 billion this year, doubling from the year ago, as investors with dedicated funds prefer India over China, where funds aimed at green power have less strict norms of use.
Sebi stipulates select sectors, including renewable and sustainable (wind, solar, bioenergy), clean public transportation, waste energy, recycling of water, bio-diversity that qualify as green or environment-free projects.
Sebi has issued no specific instructions on the quantum of green bond proceeds usage, these sectors account for nearly 100 per cent utilisation of funds in purely environment free projects in India. On the other hand, Chinese regulator the National Development and Reform Commission (NDFC) allows issuers to use up to 50 per cent of bond proceeds to re p a y bank loans and invest in general working capital, a report by the Climate Bonds Initiative and China Central Depository and Clearing Company said. Internationally , at least 95 per cent of proceeds must be linked to green assets. Some China project types like “clean coal,“ fossil fuel power stations, select hydropower projects would not be considered green by international standards. Read More…
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