Current Affairs

Government inks $300 million agreement with World Bank

Union Government (Finance Ministry) has inked a $220 million Loan Agreement with World Bank to scale-up Inida's Energy Efficiency Program.
Government inks $300 million agreement with World Bank
  • It also signed an $80 million guarantee agreement with World Bank.

More about the loan:

  • The loan will be provided to Energy Efficiency Services Limited (EESL), by World Bank through its lending arm International Bank for Reconstruction and Development (IBRD).
  • It has a maturity of 19 years and a 5-year grace period.
  • The $80 million IBRD guarantee will partially cover re-payment risks to commercial lenders or investors to enable EESL to raise funds for its program.

About the Energy Efficiency Program (EEP):

  • It will be implemented by Energy Efficiency Services Limited (EESL).
  • It will help to scale-up deployment of energy saving measures in residential and public sectors, strengthen EESL's institutional capacity and enhance its access to commercial financing.
  • Under it, EESL will deploy 219 million LED bulbs and tube lights, 5.8 million ceiling fans, and 7.2 million street lights, which will be supplied by private sector manufacturers and suppliers.

Key Components of Program:

  • Create sustainable markets for LED lights and energy efficient ceiling fans.
  • Facilitate well-structured and scalable investments in public street lighting.
  • Develop sustainable business models for emerging market segments such as super-efficient air conditioning and agricultural water pumping systems.
  • Strengthen institutional capacity of EESL.
  • Increase private sector participation in energy efficiency, including through private sector energy service companies.

Significance of all this for India:

  • The World Bank investments under this program are expected to avoid lifetime greenhouse gas emissions of 170 million tons of CO2.
  • It will also contribute to avoiding an estimated 10 GW of additional generation capacity.
  • This will help to achieve 50% of National Mission for Enhanced Energy Efficiency target of 19.6 GW indicated in India's Nationally Determined Contributions (NDCs) under 2015 Paris Agreement ( India has committed to reduce carbon emissions by 33-35% by 2030 under NDC).
  • Thus, help India to move further towards a more resource-efficient growth path.
  • It will help tackle financing, awareness, technical and capacity barriers faced by new energy efficiency programs and also support Unnat Jyoti by Affordable LEDs for All (UJALA) program of Central Government.

Question:

Q. Union Government (Finance Ministry) has inked a $220 million Loan Agreement with World Bank to scale-up India's which program?
a. Education for All Program
b. Food Security Program
c. Energy Efficiency Program
d. None of the above
Government inks $300 million agreement with World Bank Government inks $300 million agreement with World Bank Reviewed by Inderjeet Virdi on August 30, 2018 Rating: 5

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