IFC mulls South Asian clean energy investment

The institution may commit up to $20m in Global Environment Fund’s South Asia Clean Energy Fund, which aims to raise $200m.

The International Finance Corporation (IFC) is considering an investment of $20 million in the South Asia Clean Energy Fund, which is targeting commitments of $200 million to invest in the clean energy sector in the region.

The fund will make growth and expansion capital investments in companies that promote the use of efficient, reliable and cleaner forms of energy, according to documents on the IFC website. It will invest in three broad sectors, namely energy efficiency products and services, renewable energy generation and environmental products and services.

While the South Asia Clean Energy Fund will primarily invest in Indian companies, it will also consider investments in Sri Lanka, Bangladesh and Nepal. Up to a quarter of the fund’s capital may be invested in companies based in other emerging Asian economies besides India.

The fund is managed out of Mumbai by Global Environment Fund (GEF), an environment and cleantech-focused investment firm. In July 2008, GEF hired Raj Pai from CID Capital, a US investment firm, as managing director for India and South Asia.

Manila-based Asian Development Bank (ADB), the multilateral development organisation for Asian countries, is one of the promoters of the fund and has made a commitment of $20 million to the fund.

Established in 1990, GEF manages $1 billion in private equity investments. 

GEF could not be reached by press time.