Indian banks and financial institutions (FIs) are “losing out big time” by not financing renewable energy projects in India, RK Singh, the Union Power Minister said.
The minister said that he would urge the Finance Ministry to bring loans to renewable energy projects under the ‘priority sector lending’ category.
Singh said this while speaking at a session on ‘green financing’ at the 14th Clean Energy Ministerial’ (CEM 14) currently underway here.
Noting that except the two public sector lenders (PFC and REC), Indian financiers have lent very little to the Indian renewable energy sector, the minister said that the financiers are “missing the biggest market” in the world.
India would add 50GW of renewable energy capacity every year, he said, adding, “It will continue to remain the biggest market” for many more years.
Besides renewable energy, there are opportunities to lend for manufacturing of solar modules and electrolysers, he added.
India would also export modules and electrolysers, Singh said, observing that many countries were wary of buying from China.
The minister stressed that he never had to worry about finance because enough money for renewable energy projects was coming from abroad.
“My sector is booming,” he said.
On renewable energy financing being brought under ‘priority sector’, Singh said, “we (the reneable energy sector) are the ‘priority’”.
Earlier, speaking in the session, former Union Power Secretary, Alok Kumar, who demitted office recently, also observed that the share of Indian public sector banks in renewable energy financing is “small” and said that the Reserve Bank of India should “nudge” the banks to lend more to Indian RE projects.
However, this would call for more stringent disclosure norms to be followed by renewable energy companies, Kumar said.