BRICS bank grants $300 mn loan to Brazil's renewable sector

Beijing: The New Development Bank, jointly founded by the BRICS countries, and the Brazilian Development Bank have decided to give a loan of USD 300 million to develop the South American country's renewable energy sector.

The loan agreement was signed by Xian Zhu, vice president and chief operations officer of the NDB and Marcelo Siqueira, legal director of Brazilian Development Bank. K V Kamath, the president of the NDB, was among those
present on the occasion.

The loan has been sanctioned to facilitate sustainable development of energy infrastructure of Brazil through investments in at least five renewable energy and associated transmission projects.

A part of the loan has also been earmarked for the purpose of on-lending by BNDES to projects by way of debentures, a statement by the NDB said. This would assist BNDES in its efforts to develop an alternative financing source for renewable energy projects and facilitate in further development of secondary market for infrastructure financial instruments.

It is estimated that the loan will enable investments that will add around 600 MW to the Brazilian power generation capacity.

"Today's signing is another milestone in the history of the Bank. In collaboration with our member countries and development partners, the NDB is supporting clean energy projects. These projects fill critical infrastructure gaps and contribute to sustainable development. This partnership with BNDES will also, I believe, support Brazil's sustainable development," Kamath said.

Jointly founded by the BRICS -- Brazil, India, China and South Africa -- and headquartered in Shanghai, NDB was formally opened in July last year.

The Bank supports the efforts of other financial institutions and establish a network of global, regional and local partnerships with multilateral and national  development banks as well as other institutions and market players, the
statement said.