Credit and finance for MSMEs: SIDBI and France’s public financial institution Agence française de développement (AFD) on Tuesday announced signing a memorandum of understanding for strengthening cooperation on climate change and “greening” finance. The partnership will look at a “sustainable finance facility” towards green finance and other projects related to SIDBI and in turn aim to strengthen the implementation of India’s climate pledge to the Paris Agreement and net-zero emissions target by 2070.
The partnership is “a stepping stone arrangement used in seeking the cooperation opportunities between AfD and SIDBI to support and encourage programs and projects that are in line with green strategies,” SIDBI said.
The two entities will define potential cooperation and business development areas related to the Green Indian Financial System (GIFS) initiative, develop projects with the objective to green the financial system in India and other projects related to sustainable finance, and provide consultancy services for technical assistance, it added.
GIFS initiative was launched by SIDBI, AFD and Shakti Sustainable Energy Foundation (which works for supporting India’s developmental and energy security objectives) to enable discussions on greening the Indian financial system between all stakeholders.
Earlier this month, SIDBI had signed an MoU with the government body for energy efficiency Bureau of Energy Efficiency (BEE) to promote energy efficiency financing for MSMEs and explore the internet of things (IoT)-based solutions, greening MSMEs, capacity building of various stakeholders, etc.
SIDBI has also partnered with German development agency Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH and Technology Information, Forecasting and Assessment Council (TIFAC) to help MSMEs become more energy efficient in their operations to support India’s Sustainable Development Goals (SDG) 2030 targets.
According to the updated Nationally Determined Contribution (NDC) with respect to the UN’s Framework Convention on Climate Change (UNFCCC), India has targetted to cut emissions intensity of its GDP by 45 per cent by 2030, from the 2005 level and achieve about 50 per cent cumulative electric power installed capacity from non-fossil fuel-based energy resources by 2030.