Two-step Loan to State Bank of India
Supporting Energy Transition through Development of City Gas Distribution Network in India
Overseas Investment Loans
June 30, 2023
The Japan Bank for International Cooperation (JBIC; Governor: HAYASHI Nobumitsu) signed on June 29 a loan agreement amounting to up to JPY13.5 billion, of which JBIC’s portion is JPY8.1 billion, with the State Bank of India (SBI). The loan is co-financed with MUFG Bank, Ltd. and Sumitomo Mitsui Banking Corporation. JBIC also provides a guarantee for the portion co-financed by the private financial institutions.
This loan is intended to provide, through SBI, the funds necessary for the development and operation of the city gas distribution (CGD) network business run by AGP City Gas Private Limited in India, in which Osaka Gas Co., Ltd. (Daigas) and Japan Overseas Infrastructure Investment Corporation for Transport & Urban Development (JOIN) are indirectly investing.
Under its medium-term management plan titled “Daigas Group Medium-Term Management Plan 2023,” Daigas committed to accelerating business expansion in Asia, a growing market, and positioned the CGD network business in India as an important project to achieve its goal. This loan will support Daigas’s business in India and help to establish a gas supply chain in the country with Daigas’s expertise and experience in gas business, thereby contributing toward maintaining and improving the international competitiveness of Japanese companies.
At the 26th session of the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP 26) in November 2021, the Government of India expressed its goal of achieving net zero emissions by 2070, among others. Also, it is working toward building a “Gas-Based Economy” in order to achieve the goal by decreasing the consumption of environmentally unfriendly oil and accelerating energy transition toward natural gas, which has a relatively smaller impact on the environment. In alignment with such policy, the loan aims to support the use of natural gas and contributes toward the energy transition in India.
As Japan’s policy-based financial institution, JBIC will continue to provide financial support to assist Japanese companies in the overseas expansion of their businesses by drawing on its various financial facilities and schemes for structuring projects and by performing its risk-assuming function.
For further information
Mr.Sugimoto or Mr.Iseki
Press and External Affairs Division,
Corporate Planning Department