Washington, February 17 – India’s ambitious plan to expand rooftop solar power secured a $197.67 million guarantee from the World Bank Group’s guarantee arm on Tuesday.
The five-year guarantee supports refinancing a $500 million loan from the World Bank to the State Bank of India for grid-connected solar systems serving commercial and industrial users.
The Multilateral Investment Guarantee Agency (MIGA), which houses the World Bank Group Guarantee Platform, issued the guarantee to Citibank N.A. for its loan to SBI, a press release said.
The rooftop solar installations provide clean energy and reduce greenhouse gas emissions by replacing more expensive and carbon-intensive thermal generation. The loan funds a national program delivering grid-connected rooftop solar photovoltaic (RGPV) systems to commercial and industrial customers across India.
"MIGA's guarantee will support SBI's growing portfolio of renewable energy in India and contribute to India's climate goals," said Tsutomu Yamamoto, Managing Director of MIGA. "In addition, the cooperation between MIGA and IBRD on this project is another example of collaboration within the World Bank Group to mobilize private capital."
India has outlined ambitious plans for a transition to clean energy. Investment needs are estimated to be between $160 billion and $300 billion annually to achieve net zero by 2070. SBI, one of the country's largest banking and financial services institutions, has been mandated to facilitate at least 7.5 percent of its domestic gross advances as "green" financing.
SBI launched the rooftop solar project in 2016, leveraging World Bank financing and technical assistance to demonstrate the commercial viability of rooftop solar for the commercial and industrial sectors.
The World Bank program helped SBI attract international commercial lenders and private finance. The latest IBRD Implementation Report confirms that 1,004 MW of GRPV installations were achieved under the program.
Citibank acted as the sole lender, mandated lead arranger, facility agent, and MIGA coordinator for the financing. This transaction builds on a 2024 collaboration among Citi, MIGA, and SBI on a similar rooftop solar refinancing.
"This landmark transaction exemplifies Citi's commitment to fostering sustainable development and supporting India's transition to a greener economy," said Stephanie von Friedeburg, Global Head of Citi’s Public Sector Group.
"As our second collaboration with MIGA and SBI in the last two years, this initiative continues to support India's ambitious rooftop solar program, demonstrating the power of public-private partnerships to deliver impactful clean energy solutions and contribute to global climate objectives."
Rana Ashutosh Kumar Singh, Managing Director of SBI, described the refinancing as a "pioneering transaction."
"This unique alliance among SBI, MIGA, and Citi will significantly contribute to reducing the nation's carbon footprint, aligning with India's Net Zero ambitions and underscoring SBI's steadfast commitment to sustainable development."
The financing will help SBI reduce borrowing costs and diversify funding sources. MIGA said the guarantee also frees up headroom for additional World Bank lending to the government of India by transferring the loan to commercial lenders’ balance sheets.
SBI serves more than 480 million customers through over 22,405 retail branches in India and operates 235 offices in 29 countries. It was established in 1921 as the Imperial Bank of India and, in 1951, was constituted as the State Bank of India by an Act of Parliament.
MIGA is part of the World Bank Group and provides political risk insurance and credit enhancement to mobilize private capital into developing countries. In 2024, the World Bank Group consolidated its guarantee products under MIGA, aiming to boost annual guarantee issuance to $20 billion by 2030.