Facts for Prelims (FFP)
Source: Business Line
Context: In the first issuance of sovereign green bonds (SGrB) for the Financial Year 2024, the auction of five-year maturity bonds was successful, attracting decent investor interest.
About Sovereign Green Bond:
A sovereign green bond is a financial instrument that is issued by a sovereign entity, inter-governmental group, alliance, or corporation. The proceeds from the sale of these bonds are earmarked exclusively for projects classified as environmentally sustainable.
In India, sovereign green bonds showcase the country’s commitment to building a low-carbon economy. They lower the capital cost for green projects by attracting new investors, and mobilizing private capital for sustainable development.
India’s first deal in the sovereign green bond market financed expenditures in grid-scale solar and wind, decentralised solar such as solar water pumps for agriculture.
