Export-Import Bank of India Environmental, Social and Governance Framework Second-Party Opinion (2021)
Export-Import Bank of India
Use of Proceeds
Renewable energy; Water/waste water management; Pollution prevention and control; Clean transport; Energy efficiency; Green buildings; Access to essential services; Affordable basic infrastructure; Food security; SME finance and microfinance; Affordable housing;
Sustainalytics is of the opinion that the Export-Import Bank of India Environmental, Social and Governance Framework is credible and impactful and aligns with the Sustainability Bond Guidelines 2021, Green Bond Principles 2021, Social Bond Principles 2021, Green Loan Principles 2021, and Social Loan Principles 2021. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories for the use of proceeds1 are aligned with those recognized by the Green Bond Principles, Social Bond Principles, Green Loan Principles, and Social Loan Principles. Sustainalytics considers that investments in the eligible categories will facilitate the transition towards a sustainable economy, provide social benefits in developing countries and advance the UN Sustainable Development Goals, specifically SDGs 2, 3, 4, 6, 7, 8, 9, 11 and 12.
PROJECT EVALUATION / SELECTION
Export-Import Bank of India’s Sustainable Financing Committee (SFC), currently composed of representatives from its Compliance Group, Operations Group, and Legal Group, will decide eligible projects in accordance with the Framework’s eligibility criteria. In addition, the SFC will conduct an annual review of all eligible projects and may decide to remove projects that are no longer eligible. The Bank’s identification and assessment of environmental and social risks in the process of credit appraisals are applicable to all allocation decisions made under the Framework, which are viewed as adequate risk management systems. Sustainalytics considers the project selection process in line with market practice.
MANAGEMENT OF PROCEEDS
Export-Import Bank of India will track the use of proceeds using a register. Pending allocation, net proceeds from each Sustainable Financing Transaction (SFT) will be held in accordance with the Bank’s liquidity guidelines for short term time deposits or investments or will be used to repay debt excluding debt towards non-green activities. with the intended allocation period of no longer than 24 months. This is in line with market practice.
Export-Import Bank of India intends to report on allocation and impact of proceeds in its Annual Report, ESG or Sustainability Report, or on its website on an annual basis until full allocation. The allocation reporting will include details of each outstanding SFT, aggregate amount of allocated proceeds, balance of unallocated proceeds, a list of eligible projects, where feasible and projects summary information. In addition, the Bank is committed to reporting on relevant impact metrics. Sustainalytics views Export-Import Bank of India’s allocation and impact reporting as aligned with market practice.