NEW DEVELOPMENT BANK

PROJECT FINANCING AND PLANNING

ARUN BABY M WILSON
M180353AR
BRICS
 Founded: 2008; SA - 05 Rapidly
growing Economies
 Based in all regions of the global
south:
• Asia (3 countries)
• Africa (1 country)
• Latin America (1 country)
 Response to G8
 Part of G20
 20% of world’s gross products
BRICS NEW DEVELOPMENT
BANK (NDB)
 2014: Fortaleza Agreement
 Maximum capital of $100-billion
 Voting = subscription of shares i.e. equitable
 Funding: infrastructural & sustainable
development in BRICS and other developing
economies
Open & Approachable COUNTRY NUMBER OF SHARE HOLDING VOTING RIGHTS
SHARES (% OF TOTAL) (% OF TOTAL)
Transformative
BRAZIL 100,000 20 20
Sustainable
RUSSIA 100,000 20 20
Bold & Pathbreaking INDIA 100,000 20 20

Flexible & Adaptive CHINA 100,000 20 20

Egalitarian SOUTH AFRICA 100,000 20 20

Transparent UNALLOCATED SHARES 500,000 – –

GRAND TOTAL 1000,000 100 100
FOCUS OF BRICS FORUM
To establish a development bank to balance the influence of the World Bank and IMF, as well as creating a
joint foreign exchange reserve.
Business
Competitiveness
Governance & Leadership
Science & Technology
Poverty
Private Sector & Prevention of Corruption
Investment Landscape
Innovation in building Infrastructure
Trade
Healthcare
 STRENGTH OF BRICS NATIONS
BRAZIL RUSSIA INDIA CHINA SOUTH AFRICA

One of the fastest Russia has capability in 1.15 billion people Broad expansion of The South African
growing economies in the high-technology Sectors educational Achievement economy is now the 23rd
last century largest in the World

Brazilian economy Accounts for around 20% 2nd largest labour force Rapid economic growth Inflation is now below 5%
becoming less dependent of the world’s oil and Falling
on Exports and gas Reserves

Extremely rich in Fall in the number of Approximately 2.5 million Third largest country in 25% of goods produced
resources such as coffee, people living below the college graduates per land Size in South Africa are for
sugarcane, iron , and poverty line Year Export
crude oil etc
KEY INDICATORS OF BRICS NATIONS
 STRUCTURE OF
NDB
Headquarters – Shanghai
Bank will have African Regional
Center in South Africa
India will assume the first
presidency of the bank.
Chairman of Board of
governance will be Russian.
It will have
 $41 billion from China
 $5 billion from South Africa
 $ 18 billion from remaining nations
NEED FOR THE BANK
Global financial institutions like IMF and world bank are dominated by U.S and
western countries
IMF and world bank follows different voting power based on quota system. Though
China is second largest economy after U.S it has fewer voting rights.
The financial institution created by BRICS will reduce the importance of US dollar as
a global currency and eventually it will increase importance of Yuan
IMF cash assistance program is conditional. If a country's foreign policy clashes with
US then it will be difficult to obtain a loan.
It will provide resources for infrastructure development of developing countries.
NDB’S STRATEGY
The first financial priority is to preserve
shareholder capital.
Building a solid, diversified portfolio is a
key goal
Ensuring a top-notch repayment record
Seek to generate net income to build
financial reserves
Seek innovative approaches to
optimizing its balance sheet
SPECIAL FUNDS
To support project preparation.
Adopt special rules and regulations for the
establishment, administration and use
Open to contributions from member
countries - contributions from other sources
and entities
PROJECTS FINANCED BY NDB
PROJECTS – GREEN, SUSTAINABLE DEVELOPMENT
As per the ND General Strategy
Sustainable infrastructure development is at the core of the
operational strategy in 2017-2021
The Bank will dedicate about two-thirds of financing
commitments in its first five years to this area.

NDB is planning to give a priority to all the

projects aimed at developing renewable
energy sources.
Cooperate with other institutions in accelerating
‘green’ financing expansion and
promoting environment protection
Breakdown of NDB's loan approvals by sector
(as of 1 August 2018)
RENEWABLE ENERGY
CANARA RENEWABLE ENERGY FINANCING SCHEME
To sustain its long-term economic growth, India is
tackling the challenges in the energy sector.
Project Name Canara Renewable Energy Financing Scheme
Primary energy consumption of India ranks third in
Country India the world, after China and the US.
Sector Renewable Energy; Sustainable development The country is shifting towards a greener fuel mix.
Approval Date (by the
13 April 2016
Extensive national schemes have been designed to
Board) encourage renewable energy development, with a
Closing Date -
favourable policy environment.
Total Project Cost USD 500 million
The Government of India has set a target of
increasing the capacity of renewable energy to 175
Loan Amount USD 250 million GW.
Borrower Canara Bank To achieve the target, an additional funding of USD
100 billion is needed.
Implementation Agency Canara Bank
In this context, the Canara Renewable Energy
Financing Scheme is proposed to support Canara
Bank to finance renewable energy projects.
 BUDGET
The overall capacity of the Canara USD150 million has to be raised by
Renewable Energy Financing Scheme Canara bank itself
is estimated to be USD 500 million.
For the remaining USD 100 million,
The proposed financing scheme from NABARD, ADB and IMF are
NDB includes a loan of USD 250 contributing.
million, in 3 tranches:
 first loan tranche of USD 75 million
Canara bank’s investment of USD
100 million is accumulated by
 second loan tranche of USD 75 million
contributory loans by HDFC bank,
 third tranche loan of USD 100 million.
ICICI bank and Punjab National
Bank
Financier Amount ($ million)
New Development Bank 250

Other Sources 100

Borrower 150
 PROJECT STATUS
The financial assistance of $811 million has been The solar power project of 900KW
given to Brazil, China, South Africa and India. in Kerala – 500 KW is operational –
The money, to be disbursed in a staggered manner, second phase of 400KW is being
will be used to support renewable energy projects funded by ADB and NDB collectively
with a capacity of 2,370 MW in the four countries.
After getting the green signal from ministry of non MP Energy project – Sidhi –
conventional energy sources for interest subsidy, the Maintenance and expansion of the
bank aims to disburse Rs 50 crore of loan in the first
year of implementation. project – 2023
Canara Bank will charge interest at 2 per cent per Offshore energy program of Govt
annum for individuals, 3 per cent for institutional
borrowers and 5 per cent for commercial and of Goa
industrial borrowers, including small and medium
enterprises
About 12-15 mw energy could be saved by the
initiative.
The loan amount would be 85 per cent of the
project cost with repayments spread over 5 years at
convenient monthly installments.
 RENEWABLE ENERGY
LINGANG DISTRIBUTED SOLAR POWER PROJECT
China aims to increase the share of non-fossil fuel
energy to 15% of its primary energy consumption
Project Name Lingang Distributed Solar Power Project
by 2020.
Country The People’s Republic of China

Sector Renewable Energy; Sustainable Development The National Energy Administration established the
development goal of 50 GW for solar power by
Approval Date (by the
Board)
April 13, 2016 2020.
Closing Date December 21, 2019 The Lingang Distributed Solar Power Project is
Total Project Cost RMB 750.0 Million designed, supported by roof-top solar power
Loan Amount RMB 525.0 Million technology advancements.
Borrower The People’s Republic of China
The project is in alignment with New Development
Implementation Agency Shanghai Lingang Hongbo New Energy Bank’s (NDB) objective to accelerate green
Development Co. Ltd.
financing and promote clean energy development.
BUDGETING
The overall cost of the project is
estimated to be RMB 750.0 million
over a 3-year period.
The proposed financing plan includes a
loan of RMB 525.0 million from NDB
and RMB 225 million financed by
Lingang Group.
Financier Amount (¥ million)
New Development Bank 525.0
Lingang Group 225.0
The 225 million RMB is collected from
private investors in the field of
renewable energy production.
Roof top energy generation project
has proposed as initial project to this to
raise investors and public participation
PROJECT STATUS
The 525 million yuan ($76 million) loan with a maturity length of 17 years was
granted to Shanghai Lingang Distributed Solar Power Project, under an agreement
jointly signed by the NDB, the Ministry of Finance and Shanghai municipal
government in December 2016
A distributed solar photovoltaic power system with a total capacity of 100
megawatts is in construction on the rooftops of factories in Lingang Industrial Area.
The first stage with a 6.8-megawatt capacity was launched.
RENEWABLE ENERGY
DEVELOPMENT OF RENEWABLE ENERGY SECTOR IN RUSSIA
The goal of increasing the share of renewable
energy-based generation to 4.5% of total
Development of Renewable Energy Sector in
power generation in the country by 2024. Project Name
Russia Project

Promote domestic manufacturing of components Country Russian Federation

for renewable energy which will lead to Sector Energy

economic growth, job creation and technological Approval Date (by the Board) 12 September 2019
development in this area.
Total Project Cost USD 415 million
It will also help Russia to catch up with other Proposed Loan Amount USD 300 million
countries that have achieved remarkable success
in production of renewable energy equipment. Borrower Eurasian Development Bank (EDB)

Implementing Agency Eurasian Development Bank

 Further, as part of its contribution to mitigate
climate change, Russia targets to reduce its
greenhouse gas (GHG) emissions to 75% of the
1990 level by 2030.
BUDGETING
NDB will provide a loan without sovereign NDB had issued the first instalment of 75
guarantee to the international organization million USD for equipping the Project initial
EDB, with an amount up to USD 300 million. phase
NDB’s financing may not exceed 80% of USD115 million
subproject costs, unless otherwise agreed  55 million USD through loans
by NDB.  60 million USD through equity shares (15 – Govt,
35 – Private Investors, 10 million USD community
Financier Amount (USD million)
based investments as assets)
New Development Bank 300

Other Sources (Loans, Equity) 115

PROJECT STATUS
The Project is to be implemented between 2019 and 2023.
The Eurasian Development Bank will be the Project Implementation Agency.
Procurement will be conducted in compliance with the national law and regulations of
Russia, and will meet the core principles of NDB’s policy.
EIA being conducted – project started based on initial assessment
Tender inviting quotation from suppliers of various components had issued.
REQUIREMENTS FOR FINANCING
Project should be in the domain of development strategies for the current period –
2014-2019 : sustainable infrastructure
EIA report – all season EIA report with approval of all the representatives of BRICS
Complete organizational requirement as per the project
 Advisory committee
 Professional team
 Evaluation and monitoring team
 Implementing agency or authority
 Maintenance and Management team