Govt raises Rs 8,000 cr via auction of Sovereign Green Bonds

Mumbai: The first tranche of Sovereign Green Bonds (SGrBs) worth Rs 8,000 crore was subscribed fully on Wednesday. As per the auction details provided by the Reserve Bank of India (RBI), SGrB 2028 maturing in 2028 will have a coupon rate of 7.10, while SGrB 2033 maturing in 2033 will carry a rate of 7.29 percent. Coupon rates of Sovereign Green Bonds are very much in line with the G-Sec. The second auction of another Rs 8,000 crore will be conducted on February 9, said the government.

Govt issues SGrBs for mobilising resources for green infra

As announced in the Union Budget 2022-23, the central government as part of its overall market borrowings will be issuing SGrBs for mobilising resources for green infrastructure.
"SGrBs will be issued through uniform price auction and five percent of the notified amount of sale will be reserved for retail investors," the RBI said. It also added that these papers will be reckoned as an eligible investment for SLR purposes. These bonds will be eligible for trading in the secondary market.

Finance Ministry finalises framework for issuing sovereign green bonds

Proceeds from green bonds issuance cannot be used for extraction, production & distribution of fossil fuels

The proceeds from the green bonds issuance cannot be used for extraction, production and distribution of fossil fuels or where the core energy source is fossil-fuel based, and nuclear power projects.

All eligible green expenditures will include public expenditure undertaken by the government in the form of investment, subsidies, grants-in-aid, or tax foregone (or a combination of all or some of these) or select operational expenditures.

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