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Source: The post is based on the article “Social bonds explained as NABARD raises Rs 1,040 crore via its inaugural issue” published in “CNBC” on 28th September 2023.
What is the News?
National Bank for Agriculture and Rural Development (NABARD) has issued its inaugural social bonds with a total size of Rs 1,040.50 crore.
What are Social Bonds?
A social bond is a type of financial instrument issued by governments, international organizations or corporations to raise funds for projects and initiatives that have a positive social impact on society.
These bonds are designed to finance projects that address various social issues, such as healthcare, education, affordable housing, poverty alleviation, and environmental sustainability.
First Social Bond: The Pimpri Chinchwad Municipal Corporation (PCMC) in Maharashtra’s Pune and United Nations Development Programme (UNDP) in 2020 co-created India’s inaugural Social Impact Bond(SIB).
What is Sustainability Bond Framework?
NABARD recently announced a Sustainability Bond Framework.
The framework seeks to finance and refinance new or existing eligible green and social projects.
Eligible social projects include affordable basic infrastructure, access to essential services, affordable housing, employment generation, food security, socioeconomic advancement, and empowerment.
Projects that promise energy efficiency including green buildings, energy storage, and smart grids, would also be eligible to get funding.
