CHENNAI: In a first, the Greater Chennai Corporation (GCC) is set to issue green municipal bonds worth Rs 205.64 crore to raise capital for sustainable urban development projects. A resolution in this regard was passed at the council meeting on Wednesday.
The funds raised through green bonds will be used to finance the biomining project at the Kodungaiyur dumpyard, to reclaim 252 acres of land. While the total project cost is Rs 640.83 crore, GCC’s share stands at Rs 385.64 crore. Of this, Rs 205.64 crore will be raised through green bonds and the remaining Rs 180 crore will be sourced through external funding via the Germany-based development bank KfW.
Highlighting the success of other municipalities like the Indore municipal corporation, which saw 5.91 times oversubscription, and Pimpri-Chinchwad municipal corporation, which saw 5.13 times oversubscription, the GCC said there is a strong demand for green bonds.
As a second-time issuer of municipal bonds and a first-time issuer of green municipal bonds, GCC is also eligible for an incentive of Rs 10 crore for every Rs 100 crore raised under the AMRUT 2.0 scheme.
The GCC’s bond issuance committee is expected to submit the proposal to the state government for approval in the coming days. Earlier in May, GCC listed its first municipal bonds on the National Stock Exchange, raising Rs 200 crore at 7.97% interest over 10 years.