Green bonds, SLBs, MDBs in focus at Guwahati G20 meet on sustainable finance

Guwahati: Raising funds through green bonds, Sustainability Linked Bonds (SLBs) and other such instruments for development projects was discussed on the first day of the G20 meeting in Guwahati on Thursday. The delegates of the influential world grouping also deliberated on raising the size of blended finance, and stressed on the importance of Multilateral Development Banks (MDB) to deal with growing concern for climate change impacts.

"We discussed how to raise funds through green bonds and Sustainability Linked Bonds by the private players for implementing their projects. All the members put forward their statements at the meeting," an official of a Switzerland-based financial think tank said on the sidelines of the meeting.

Green bonds, also known as climate bonds, are fixed-income financial instruments used to fund projects having environmental benefits, while SLB is a type of bond that focuses on achieving pre-defined sustainability objectives. "Currently, green bonds and SLBs are just 5 per cent of the world's total financial assets. The need to increase these instruments, especially by 2030 Sustainable Development Goals (SDGs), were stressed," the official said.

"The meeting also discussed blended finance and how to increase it. How the government can encourage private players to invest in green technologies was deliberated upon during the day," he said.

Blended finance is mobilisation of private capital alongside development or public funding to finance sustainable development in emerging and frontier markets. A senior official of the People's Bank of China, the central bank of the country, said the members raised their queries on how to "de-risk" projects funded by blended finance.