(BII), the UK’s development finance institution and impact investor, has disclosed a commitment of $25 million to the first close of the GEF South Asia Growth Fund III (GEF SAGF III). This fund aims to invest in companies and projects that contribute to transitioning towards a low-carbon and resource-efficient economy, with a primary focus on India and certain areas in Southeast Asia.
The Indian subcontinent faces climate change vulnerabilities, marked by a rise in extreme weather events such as flash floods and heat waves. The Indian government has established targets, aiming to meet 50% of its electricity needs through renewable energy sources by 2030 and achieve net-zero emissions by 2070. It is estimated that $160 billion per year is needed until 2030 to achieve these goals.
“Combatting climate change together is one of the top UK/India priorities. Today’s announcement shows the UK’s commitment to support India’s green growth and creating new, green jobs, and BII’s work to reduce greenhouse gas emissions while alleviating poverty,” said Alexander Ellis, the British High Commissioner to India in a statement.
The Fund’s differentiated, high-impact climate finance strategy invests in three critical areas that support India’s transition to a green economy – Adaptation, Mitigation, and Circular Economy.
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This development reflects BII’s commitment to invest up to $1 billion into climate-related projects in India between 2022 and 2026, according to the statement.
“BII has been a critical catalyst for scaling climate finance in South and South East Asia by extending its expertise in climate investments, ESG and developmental impact thought leadership. GEF remains very excited to count BII as a long-term partner towards defining sustainable, and inclusive growth through our climate impact investment,” said Raj Pai, Managing Partner at GEF Capital.
GEF SAGF III follows the predecessor fund, GEF SAGF II where BII had also committed $25 million.
With the investment from BII, the Fund will target diverse sectors such as renewable energy value chain, energy efficiency, solutions for food and water security, low-carbon transition, and waste recovery, among others.
Edited by Affirunisa Kankudti
