India has received a major funding boost from multilateral and international development banks for its ambitious rooftop solar power program.
The Ministry of New & Renewable Energy has announced that India’s rooftop solar power program is expected to receive low-cost debt funding worth $2.5 billion from several international development banks.
The World Bank has committed $620 million, while the Asian Development Bank and BRICS New Development Bank have pledged to provide $500 million and $250 million, respectively. The German development bank KfW has provided $100 million, and negotiations for $1.14 billion worth of funding are underway.
These funds will be made available to retail and commercial banks in India, including the State Bank of India, Punjab National Bank, and Canara Bank. Project developers will be able to secure loans from these Indian banks at low rates.
India has set a target to have 100 GW of solar capacity operational by April 2022, including a target of 40 GW for rooftop solar power systems. Rooftop solar capacity represents just 10% of the 5 GW solar capacity currently operational in India. Increasing the capacity to 40 GW in about 6 years will be a gargantuan task.
The government has taken initiatives to boost the development of the sector. The Cabinet of Ministers recently approved a proposal that will increase the subsidy for rooftop solar power systems to $770 million by 2022, which is expected to be in addition to the debt funds raised from international development banks.