Green Municipal Bonds | 30 Apr 2025
Why in News?
Ghaziabad Municipal Corporation in Uttar Pradesh has become the first in India to issue a certified Green Municipal Bond under the Swachh Bharat Mission–Urban to promote sustainable water management.
Key Points
- About Green Bond:
- Green bonds are debt instruments used to raise funds for green projects , particularly in areas such as renewable energy, clean transportation, sustainable water management , etc.
- A bond, which is a fixed income instrument, represents a loan made by an investor to a borrower (usually a corporate or governmental).
- Traditional bonds (other than green bonds) pay a fixed interest rate (coupon) to investors.
- Green bonds enhance the reputation of the issuer, as it helps demonstrate their commitment to sustainable development.
- Green bonds are debt instruments used to raise funds for green projects , particularly in areas such as renewable energy, clean transportation, sustainable water management , etc.
- Ghaziabad’s Success:
- Ghaziabad raised Rs 150 crore via India’s first Green Municipal Bond.
- The funds built a modern tertiary sewage treatment plant (TSTP).
- The project runs on a PPP-HAM model with 40% civic investment.
- The bond's success boosted investor trust in urban local bodies.
- Ghaziabad won the 2024–25 Best Municipal Treated Water Award.
Swachh Bharat Mission-Urban
- Introduction:
- Swachh Bharat Mission-Urban (SBM-U) was launched on 2 October 2014 by the Ministry of Housing and Urban Affairs as a national campaign to promote cleanliness, hygiene and proper waste management in urban areas.
- Its objective is to make the cities and towns across India clean and free from open defecation .
- Swachh Bharat Mission-Urban 1.0:
- The first phase of SBM-U focused on achieving the goal of making urban India open defecation free by providing access to toilets and promoting behavior change.
- SBM-U 1.0 was successful in achieving its target and 100% of urban India was declared ODF .
- Swachh Bharat Mission-Urban 2.0 (2021-2026):
- SBM-U 2.0, announced in the Budget for 2021-22, is a continuation of the first phase of the same scheme.
- Its second phase aims to move towards the goals of ODF as well as ODF+ and ODF++ and focuses on making urban India garbage-free .
- It emphasizes on promoting sustainable sanitation practices, waste management and a circular economy.