This development marks AIIB’s first loan to a non-banking financial company (NBFC) in India. AIIB is a multilateral development bank that invests in sustainable infrastructure.
The loan proceeds will be used to on-lend to large and mid-scale wind and solar power infrastructure projects in India. LTIF’s collaboration with AIIB will also help the company bolster its environmental and social capabilities, which will enable it to tap the international market for green finance, in the future. The proposed financing supports AIIB's Sustainable Energy for Asia Strategy and Strategy on Mobilizing Private Capital for Infrastructure.
“Investments from an organization like AIIB, that follows a stringent due diligence process of the company’s capacity, viability, past performance and regulatory compliances, before any investments, reiterates our commitment to green project financing.
Our lending to clean energy goes beyond the actual book and we have today built an ecosystem for all stakeholders to be a part of the green energy initiative. We firmly believe that renewable power holds great potential in fighting the dual challenge of climate change and the ever-growing demand for energy,” Dinanath Dubhashi, Managing Director & CEO, L&T Finance Holdings said.
LTIF has initiated the establishment of an Environment & Social Monitoring System that will be expanded to include screening, categorizing, appraisal, contracting and monitoring of subprojects supported by AIIB in accordance with the AIIB Environmental and Social Standards (ESS).
L&T Finance Holdings Ltd ended at Rs71.35 up by Rs1.4 or 2% from its previous closing of Rs69.95 on the BSE.