The Indore Municipal Corporation (IMC) in Madhya Pradesh (MP) is planning to issue India’s first municipal green bond (local government bond), aimed at retail investors, with the revenues going toward funding a solar power plant.
It plans to sell 10-year bond in December 2022 in order to raise up to Rs. 2.6 billion (USD 31.8 million).
Note: Indore in MP is a city in India with a strong environmental record.
i.The issuer, IMC, has designated A.K. Capital Services Ltd. and SBI Capital Markets Ltd. as lead managers for the offering.
ii.The 60-megawatt (MW) solar power plant will be built near Indore for Rs. 3 billion.
- It will help the city save up to Rs. 250 million each month on its electricity bill.
iii.The green debt sale comes at a time when the World Bank (WB) estimates that India, Asia’s third-largest economy, will need to invest USD 840 billion in urban infrastructure over the next 15 years to meet demand from a rapidly rising urban population.
iv.The Reserve Bank of India (RBI) has also urged local governments that rely significantly on bank loans or government grants to consider issuing municipal bonds to meet their funding needs.
About Madhya Pradesh (MP):
Chief Minister (CM) – Shivraj Singh Chouhan
Governor – Mangubhai Patel
National Parks – Dinosaur Fossil National Park; Van Vihar National Park
Wildlife Sanctuary – Bagdara Wildlife Sanctuary; Gandhi Sagar Sanctuary