Germany, India sign agreements for energy efficiency and clean technologies
The Small Industries Development Bank of India (SIDBI) and the German Government’s Development Bank KfW, signed a series of agreements today for financial assistance totaling EURO 89.2 million (appr. Rs 622 crore) to promote the adoption of energy efficient and cleaner production technologies by micro, small and medium enterprises (MSMEs) in India. Two sets of agreements were signed in the Ministry of Finance in the presence of Mr. Kumar Sanjay Krishna, Joint Secretary, Department of Economic Affairs, Ministry of Finance.
Each set comprises an integrated package of concessional loan and technical assistance for awareness raising and general capacity building to support financing of environmental investments in the MSME sector by SIDBI. The MSME Energy Efficiency Programme consists of a credit line of EURO 50 million and an accompanying grant component of EURO 0.5 million for technical support; the MSME Cleaner Production programme involves a credit line of EURO 38.5 million and a grant of EURO 0.2 million for technical support.
Despite recent reductions in the overall energy intensity of the Indian economy, the MSME sector still faces a challenge to meet industry benchmarks in technology upgradation, pollution control and energy efficiency. Given the critical contribution of MSMEs to the Indian economy in terms of output, employment and exports, adoption of environmentally friendly, cleaner production techniques by MSMEs is key to achieving high growth rates that are at the same time low-carbon and environmentally sustainable. The two agreements signed today support SIDBI’s initiatives to strengthen the MSME sector and further deepen the longstanding cooperation between SIDBI and KfW.
About SIDBI: SIDBI is the principal financial institution for the Indian MSME sector. SIDBI meets the funding and developmental needs of the MSME sector by extending financial support and promotional assistance both directly as well as through an extensive network of banks, financial institutions and microfinance institutions.
About KfW: German Financial Cooperation is channeled through KfW, which acts as implementing agency on behalf of the German Government. KfW Entwicklungsbank or KfW Development Bank is part of the KfW Bankengruppe, one of the largest banks in Germany.
Germany and KfW are longstanding partners of India. Since the 1950s, more than EURO 8 billion have been sanctioned by KfW, mainly in the fields of Energy, Financial Sector Development, Health, and Protection of the Environment and Natural Resources.. The main objective of the German Government is to work together with the Indian Government in facilitating inclusive growth, reducing poverty and meeting the Millennium Development Goals.
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