Maharashtra’s Money Goes Green—Pimpri-Chinchwad Leads the Charge

Image Source: Punekar News

Historic Milestone in Green Urban Financing History has been marked by the Pimpri-Chinchwad Municipal Corporation (PCMC) by becoming the first municipal authority in Maharashtra to list Green Municipal Bonds at the Bombay Stock Exchange (BSE). This is a historic milestone that will raise funds solely for green urban mobility projects, paving the way for climate financing by Indian municipalities.

Investor Confidence and Market Response The issue of Rs 200 crore of bonds witnessed huge investor appetite, as the base issue size of Rs 100 crore got subscribed in the first minute of opening alone. The bids were to the tune of Rs 513 crore, which oversubscribed the issue by 5.13 times. This is an indication of the faith investors have in the governance of Maharashtra and the vision of PCMC for urban sustainable development.

Strategic Urban Projects The funds from these bonds will be used to fund two significant infrastructure projects:

The Nigdi-Pradhikaran Harit Setu project, for green connectivity enhancement.

A green mobility corridor along the road stretch from Gawalimatha to Indrayaninagar Chowk on Telco Road, with first and last-mile access to metro and BRTS systems.

They are part of PCMC's master plan for climate and mobility for the 15-minute city idea, promoting sustainable urban transport modes.

Government Acceptance and Support Maharashtra Chief Minister Devendra Fadnavis, Deputy Chief Ministers Eknath Shinde and Ajit Pawar, and other dignitaries attended the bell-ringing ceremony at the BSE. Fadnavis termed the initiative as a source of pride for the state and attributed the role of the municipal bonds in the mobilization of funds for sustainable development. PCMC Commissioner Shekhar Singh appreciated the investors' faith and termed the listing as a pioneering step towards a greener, more resilient Pimpri-Chinchwad. Financial Incentives and Structure The AA+ rated green bonds by CRISIL and CARE carry an interest rate of 7.85 percent. The repayment is guaranteed by an escrow account backed by the receipt of PCMC's property tax, encouraging fiscal discipline. The Government of India has also provided PCMC with an incentive of Rs 20 crore for the successful issue of the bonds.

A Template for Future Urban Finance PCMC's trailblazing decision not only introduced a fresh model of financing but also provided a replicable template for mainstreaming climate finance in urban local government in India. The initiative's success is guaranteed to inspire other municipal corporations to follow similar paths towards sustainable urban development.

Sources: MSN, Indian Express, GoodReturns, Rediff, Mid-Day.