RPower, US Exim Bank in $5-bn deal
New Delhi: Reliance Power, the Reliance Anil Dhirubhai Ambani Group’s power firm, has sealed a $5- billion (nearly Rs 22,000 crore) funding deal from the US Export Import Bank for its gas-based and renewable energy projects totalling about 9,000 mw. This deal is among the numerous business deals which has been announced between the US and India coinciding with the three-day visit of US President Barack Obama to India. The deal between Reliance Power and US Exim Bank was signed by Reliance Power chairman Anil Ambani and Exim Bank chairman and president Fred Hochberg on Saturday evening.
On Saturday, Reliance Power had announced a deal in the presence of Obama to procure equipment worth about Rs 10,000 crore from General Electric and other US companies for its various power and coal mining projects. “As we look to India today, the US sees an opportunity to sell our exports in one of the fastest growing markets in the world. For America this is a jobs strategy,” Obama had said on the occasion.
Commenting on the commercial deals between the two companies of the two nations and totalling $10 billion and with job creation potential of 50,000, Obama had said this was barely scratching the potential and dubbed India as the market of the future.
Under the MoU, “Exim Bank will make available up to $5 billion in support of purchases of US goods and services for the group’s various projects including among others 900 mw of renewable power generating technology (solar and wind) and up to 8,000 mw of gas-fired thermal electric generating technology,” company stated. “This is defining moment in Indo-US energy cooperation,” ADA Group chairman Anil Ambani had said after signing the deal with General Electric chairman Jeff Immelt on Saturday.
On the $5 billion Exim Bank financing deal, RPower said this would be in addition to the $917 million secured in October this year to finance its facility in Sasan, where the company is undertaking a 4,000 mw ultra mega power project.
The company said the MoU would enable RPower and its affiliates access Exim Bank’s long-term loans at a substantially reduced processing time.
“Considering that Exim Bank exposure to India has been primarily limited to public sector, execution of the MoU is a landmark event that would go a long way in increasing diversity of lenders that could provide long term finance to India’s private sector.