THEME -
SUSTAINABLE MARKETS
Indian market
Unchartedareas
Integrated approach
Somak Ghosh - Rl is raising its sustainability profile in India
Daan Dijk - environmental markets are a commercial proposition
India is one emerging economy where RI is raising its
sustainability profile. With India being the second fastest
growing source of greenhouse gas emissions in the world,
there is an urgent need for exploring sustainable alternatives
to development. The environmental products and services
market is expected to be worth around USD 14 billion by
2005. Rabo India recently launched a specialized product
category focusing on sustainability and social innovation
within its Infrastructure Project Advisory team. This team
is involved in projects and Public-Private Partnerships
relaring to renewable energy, waste management, the water
sector and air pollution.
Somak Ghosh, head of the Infrastructure Project Advisory
team, fills in some background: 'Development Financial
Institutions (DFIs) have always been around in India, hut
in the last ten years they've shifted their focus towards
commercial banking. Rabo India has moved to fill this
vacuum by providing financial solutions to projects in un-
charted areas. By this I mean projects which qualify for the
"sustainable" label and typically find it difficult to achieve
financial closure. For instance because there are no finan-
cially strong sponsors setting up these projects, or because
the technology is new and untested in India, although
proven elsewhere. We recognized a business opportunity
when we started receiving many proposals for commer-
eially viable projects using non-conventional technology.
Many of these were intrinsically viable but needed structur-
ing to make them commercially bankable.' Rabo India is
working with a number of Small to Medium Fntcrpriscs
(SMEs) in renewable energy projects to convert municipal
solid waste into power or effluents from the sugar industry
or biomass (agriwaste) into organic fertilizers. These projects
help to solve waste disposal problems and to reduce green
house gases.
The members of the Rabo India Infrastructure Project Ad
visory team all have engineering backgrounds and a mix of
equities, project financing and corporate advisory experience.
This combination of technical and banking know-how
allows the Rabo India team to offer an integrated approach.
'We are able to offer our clients an understanding of both
the technology and capital markets,' confirms Ghosh.
'Other organizations are limited to providing finance, and
usually only get involved in projects when the Engineering,
Procurement and Gonstruction (EPG) contracts are already
negotiated and the sponsors are looking for finance. We are
8 I The Word I