New €100 million EIB and State Bank of India private sector climate action initiative launched at EU-India Leaders Meeting
Luxembourg/New Delhi/Mumbai-May 08 2021: On the margins of the EU-India Leaders Meeting, the European Investment Bank (EIB) and the State Bank of India (SBI) have agreed to back a new initiative of €100 million for new high-impact climate action and sustainability business financing.
The importance of the new Neev Fund II to accelerating India’s green recovery from COVID-19 and strengthening sustainable investment was highlighted by EIB President Werner Hoyer in discussions ahead of the formal announcement at the EU-India Leaders Meeting in Portugal. The EIB and SBI will together support the new Neev Fund II investment fund that will unlock climate action and sustainability investment by businesses across India through new equity financing.
Under the management of SBICap Ventures, an SBI group company, Neev Fund II will invest up to €100 million in Indian small and medium-sized enterprises (SMEs) and provide growth and expansion capital to companies offering solutions for clean energy, electric vehicles, efficient use of raw materials, and water and circular economy projects in the country. The fund will enable Indian innovative and emerging companies to fund their growth through equity or quasi-equity instruments.
The EIB-SBI partnership reinforces climate action and environmental sustainability both in India and globally, strengthens the country’s innovative SMEs, sustains and creates jobs, and contributes towards green, long-term and sustainable economic development.
EIB Vice-President Christian Kettel Thomsen, who is in charge of operations in India, said: “Climate change claims thousands of lives and causes damage amounting to hundreds of billions of euros every year. It does not have to be like this, however, as there is still time to act. Innovative solutions often require innovative forms of financing, such as private equity funds. Our partnership with the State Bank of India will create a much-needed source of equity financing for climate action and environmental sustainability solutions offered by innovative SMEs. Saving our planet from climate change requires an all-hands-on-deck approach and the EIB is proud to have found an ally in the State Bank of India ready to deploy innovative financing solutions for global climate action. This is a true sign of the global impact of the EU-India partnership.”
State Bank of India Chairman Dinesh Khara added: “SBI’s core ethos of financial inclusion and social development underpins its commercial activities and is reflected in its decision to invest in Neev Funds. Neev Fund II will provide equity to SMEs focusing on mitigating climate risks, promoting social development, job creation and gender equality at scale. I believe the joint cooperation of the two institutions, the EIB, which is one of the world’s largest providers of climate finance, and SBI which is India’s largest financial institution, will further strengthen and deepen the bond between India and the European Union.”
MD & CEO of SBICap Ventures Suresh Kozhikote said: “Neev Fund has leadership status in environmentally and socially conscious investing. It generates commercially attractive returns while making a significant positive contribution to society. Neev Fund II is a worthy successor to our flagship Neev Fund that has set nationwide benchmarks for governance standards and its pioneering work in environmental, social and governance and developmental impacts.”
EU Ambassador to India Ugo Astuto stated: “Climate action and environmental sustainability are the need of the hour to save our planet. Climate change and the green transition will also be key priorities at the upcoming EU-India Leaders Meeting. The EIB has been investing in sustainable infrastructure in India for over 25 years. This latest funding will further strengthen our cooperation with India and help the private sector to develop innovative solutions to tackle climate change.”