Quick Facts
More About This Project
India’s road transport presently accounts for 12% of India’s energy-related CO2 emissions and is a key contributor to urban air pollution. As India seeks to meet the increasing demand for the transport of goods, CO2 emissions from road transportation could double by 2050. The commercial vehicles fleet is going to expand steadily and therefore it is necessary to invest in and promote clean transport solutions. The Project’s goal is to finance low emitting commercial vehicles thus creating sustainable transport infrastructure and reducing pollution.
Shriram Finance Limited (SFL) is one of the largest non-bank finance companies in India registered with Reserve Bank of India (RBI) and holds top position in commercial vehicle financing segment in India. NDB’s loan will provide longer-term funding to SFL to support and expand SFL’s lending for acquisition of low emitting and energy efficient sustainable vehicles for individual driver turned owners, first time borrowers, micro, small and medium-sized enterprises (MSMEs) including small road transport operators (SRTOs) having 4-5 vehicles engaged in transport and logistics in India.
The Project will contribute to creating sustainable transport infrastructure, pollution reduction and decrease of greenhouse gas (“GHG”) emissions in the country by increasing financing available for low carbon commercial vehicles.
NDB funds will be used to finance commercial vehicles based on agreed eligibility criteria in terms of composition of vehicles based on fuel such as CNG/LNG/EV/BS-VI. The eligibility criteria also include state specific utilization for greater impact in low-income states and industrialised states based on need to create sustainable transport infrastructure and reduce pollution. The project will be implemented over a period of 18 months.
The Project has been categorized as Category FI-C in line with the NDB Environment and Social Framework (ESF). SFL will use the proceeds of the NDB Loan to extend loans to individuals, (MSMEs), SRTOs, to acquire commercial vehicles that will align with the eligibility criteria set forth for using cleaner fuel and efficient engine technology vehicles. An Environmental and Social Impact Management Plan has been developed to ensure compliance with the provisions of the country systems and the NDB ESF.
Source of Fund | Amount (USD) |
NDB | USD 125 million |
Other Sources | USD 375 million |
NDB | Borrower and Project Entity |
Private Sector and Non-
Sovereign Guaranteed Transactions Department: Mr. Kishor Raichandani |
Mr. Vedansh Chandak |