Approval for the funds enables solar energy suppliers to avail loans at a lower rate of interest for new projects.
IIFCL chairman and managing director SK Goel told The Hindu Business Line that the non-banking finance company had begun implementing the general terms and conditions after the firm’s proposal was accepted by the bank.
Goel further said that the line of credit (LoC), expected to be operational before end of December 2012, caters to all renewable energy projects with focus on solar energy.
"The World Bank, IIFCL and the Government of India all want to encourage solar. I don’t see why this cannot happen," Goel added.
Until recently, the government-owned IIFCL has extended loans to support 210MW of solar projects.
According to the chairman, IIFCL’s existing borrowers would also benefit from lower interest rates of less than 4% on foreign currency loans.
Of the total $200m LoC, IIFCL plans to utilize part of the amount for replacement of existing rupee loans of its solar borrowers.
