I believe so. Latest reports suggest that the country’s renewable energy developers raised more than $15 bn through overseas green bonds.

Interestingly, over the last few years, Indian RE developers have been able to move away from the domestic lending lines and raise funds from international #bondmarkets (green bonds) at competitive rates. The numbers have added up to $15.5 bn since 2014.

Typically, the green bond issuances by Indian RE developers are priced between 4.0% to 6.0%, a spread of about 4.0% over the US treasury rates for a tenure of 5-7 years. These raised funds are used for refinancing the rupee debt for operating assets through a restricted group structure.

Considering the hike in interest rates both internationally and domestically, the credit metrics will see moderation. The financing of outstanding overseas green bonds is expected to be higher than the prevailing interest rates. This is expected to slow down in bond-raising activity in the current fiscal.

Do you agree?