India and US to Raise USD 1 Billion for Clean Energy Manufacturing Capacity

India and the U.S. are collaborating to access $1 billion in multilateral finance from the International Bank for Reconstruction and Development (IBRD) to assist in expanding manufacturing capabilities related to solar, wind, battery, and energy grid systems, as well as high-efficiency air conditioners and ceiling fan supply chains.

During Prime Minister Narendra Modi's visit to the U.S., the two countries released a statement unveiling a plan to create secure global clean energy supply chains and enhance mutual support for clean energy technologies through technical, financial, and policy assistance.

The collaboration also intends to establish the foundation for working together in other countries, specifically in Africa.

The goal is to work together with private companies to identify suitable opportunities in these supply chain sectors and assist with a starting set of trial projects, with the hope of including at least one project targeting the implementation of clean energy in Africa.

Over time, more investment plans and funding sources can be created. This initiative will expand on private sector collaborations enabled by the U.S. Development Finance Corporation (DFC) in the solar, wind, battery, and critical minerals industries to seek investments for producing clean energy parts.

These types of investments could qualify for India's Green Transition Fund, which aims to back renewable energy, storage, and e-mobility ventures in India. This fund will also help boost the need for local manufacturing. Additionally, Eversource Capital, an Indian private equity fund manager, has launched a new $900 million fund supported by DFC to invest in clean technologies.