In two separate developments, German financial institution KfW Group will be providing loans to support India’s development projects in the field of power T&D and renewable energy.
The first agreement was between Government of India and KfW for a reduced-interest loan for 140 million Euros and a grant of 2 million Euros, both for the Energy Reforms Programme in Madhya Pradesh.
The project comprises of two components — implementation of smart meters & Advanced Metering Infrastructure (AMI); and, separation of agriculture & non-agriculture feeders.
The project will contribute to a more stable, secure and climate and environmentally friendly energy supply in India by upgrading and strengthening distribution networks in Madhya Pradesh. It will contribute to an effective, technically and economically efficient as well as socially and ecologically sustainable energy supply.
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Renewable Energy
The second agreement related to REC Ltd (formerly, Rural Electrification Corporation) that entered into an agreement with KfW Development Bank for availing ODA (Official Development Assistance) term loan of $169.5 million under the Indo-German Bilateral Partnership in accordance with the approval granted by Department of Economic Affairs, Ministry of Finance, Govt. of India.
Proceeds of this loan will be deployed for part-financing of power generation projects based on innovative solar PV technology in India, at competitive interest rates.
This is the fifth credit line signed between REC Limited and KfW for financing of power sector projects and third credit line for financing of renewable energy projects, a government statement said.
REC is continuously re-shaping its policies to align with market requirements and developing financial solutions and mechanisms that create scalable and effective ways of channelizing both private and public investments in the renewable energy space. REC offers the lowest interest rates to renewable energy sector among all the segments being financed by the corporation, the release said.
Featured photograph (source: kfw.de) shows KfW’s headquarters at Frankfurt, Germany.
