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Sovereign Green Bonds India : For the first time, emphasis is being laid by the Central Government on raising money through Green Bond. Regarding this, the first installment of RBI Sovereign Green Bond has also been released. Sovereign green bonds with dedicated green funds have been issued in the market for auction with Foreign Portfolio Investors, Local Banks, Insurance Companies. Know what is the complete information related to it.
What did RBI bank say
According to media reports, the Reserve Bank of India (RBI) says that the central government has sold securities worth Rs 80 billion ($ 1 billion). In this, issues of 40 billion rupees have been issued for 10 years and for the remaining 5 years. The 10-year bond is priced at a coupon of 7.29 per cent, which is less than 6 basis points from similar maturity sovereign debt.
The second installment will be released on February 9
RBI has issued the first installment of Sovereign Green Bond of Rs 8000 crore on 25 January 2023. In this, Green Bonds worth Rs 4000 crore have been issued for 5 years and Sovereign Green Bonds worth Rs 4000 crore have been issued for 10 years. Its second installment will be issued on 9 February 2023 as Sovereign Green Bond of 8000 crores. In this, green bonds worth Rs 4000 crore will be issued for 5 years and sovereign green bonds worth Rs 4000 crore will be issued for 10 years.
Target kept to raise 16 thousand crores
The Modi government has set a target of raising Rs 16,000 crore from green bonds by the ongoing financial year i.e. March 31, 2023. For this, the government has taken this step to raise money for clean energy at cheap rates and it is expected that this effort will be great. According to RBI, the bids received were worth more than 4 times the amount on offer, the 5-year bond was sold to 32 investors and the 10-year bond was sold to 57 investors.
The government will benefit from the bond
According to the reports, the same businessmen say that the interest of domestic players is being seen on a large scale in this first issue. Going forward, the demand from global investors is expected to increase. Local banks and mutual funds that do not have an overwhelming mandate to invest in these green bonds can issue them at par with other sovereign bonds. Insurance companies have been allowed to classify these as infrastructure investments. These bonds may not lead to a significant reduction in the government’s savings or reduction in borrowing limits.
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