The RBI has decided to permit eligible foreign investors in the International Financial Services Centre (IFSC) to also invest in Sovereign Green Bonds (SgrBs). This is with a view to facilitating wider non-resident participation in SgrBs.
At present, foreign portfolio investors (FPIs) registered with SEBI are permitted to invest in SGrBs under the different routes available for investment by FPIs in government securities.
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A scheme for investment and trading in SGrBs by eligible foreign investors in IFSC will be notified separately in consultation with the Government and the IFSC Authority.
Based on an announcement in the Union Budget for FY23, the Government of India (GoI) issued Sovereign Green Bonds (SGrBs) in January 2023. SGrBs were also issued as part of the Government borrowing calendar in FY24.
The issuance of Sovereign Green Bonds by the GoI is aimed at tapping the requisite finance from potential investors for deployment in public sector projects and reduce the carbon intensity of the economy.