The World Bank has approved a financing package of USD1.5bn to support India’s efforts in developing low-carbon energy, as reported by Reuters on June 30. The funding aims to accelerate the expansion of renewable energy, foster the development of green hydrogen, and facilitate climate finance for low-carbon energy projects in India. Anticipating a rapid expansion of India’s energy consumption driven by economic growth, the World Bank indicated that India needs to phase down the share of fossil-based energy sources to achieve the country’s net-zero emissions goal by 2070. Additionally, the World Bank recognizes the significance of investing in green hydrogen to decarbonize India’s industrial sector.
The financing package demonstrates the World Bank’s commitment to supporting India’s transition towards a low-carbon economy by complementing public financing and mobilizing private sector investments. The World Bank acknowledges that public funding alone is insufficient to meet India’s extensive financing requirements for its energy transition. Therefore, the USD1.5bn financing program aims to address funding gaps, mitigate risks for project off-takers, improve the integration of renewable energy into the grid, and stimulate the demand for renewable energy. According to Auguste Tano Kouame, World Bank Country Director for India, the funding will also support the implementation of India’s National Green Hydrogen Mission, which aims to stimulate USD100bn in private sector investment in green hydrogen by 2030. By then, India plans to have 500 gigawatts (GW) of renewable energy capacity, tripling the current level of around 169GW.