Sagarmala Finance plans India’s first blue bond issue

Sagarmala Finance Corporation Limited (SMFCL) is set to launch India’s first Blue Bonds during the current financial year, marking a significant step in mobilising capital for the country’s maritime and blue economy sectors.

The state-owned lender is preparing its maiden bond issuance to raise up to ₹1,000 crore, targeting investors interested in financing sustainable maritime and ocean-related projects.

About Sagarmala Finance Corporation

Sagarmala Finance Corporation Limited is India’s first maritime-focused Non-Banking Financial Company (NBFC).

Key targets include:

• Cumulative disbursements of ₹60,205 crore by 2030–31.
• Fundraising mandate of up to ₹25,000 crore.
• Financing projects related to ports, shipping, logistics, inland waterways, and maritime infrastructure.

The proposed bond issue is also expected to help address the company’s asset-liability mismatch, as its current borrowings have an average maturity of around 3.5 years, while its loan assets generally have tenures of nearly 12 years. 

What are Blue Bonds?

Blue Bonds are debt instruments through which funds are raised exclusively for projects that support the sustainable use and conservation of oceans, seas, coastal areas, and water resources.

The proceeds are earmarked for activities such as:

• Water and wastewater management
• Reduction of marine plastic pollution
• Marine ecosystem restoration
• Sustainable fisheries and aquaculture
• Sustainable shipping and ports
• Eco-friendly coastal tourism
• Offshore renewable energy projects

Similarly, Blue Loans are lending instruments dedicated to financing blue economy initiatives. 

Global Background

The world’s first sovereign blue bond was issued by Seychelles in October 2018, with support from the World Bank.

Blue bonds are now issued by national governments, development finance institutions, multilateral banks, corporations,Financial institutions 

Blue Bonds contribute directly to 

• SDG 6 – Clean Water and Sanitation
• SDG 14 – Life Below Water.

Role of IFC in Blue FinanceThe International Finance Corporation (IFC) has emerged as a major promoter of blue finance globally. Since 2020 IFC has provided over $2 billion through blue bonds and blue loans. It facilitated the first blue bonds in the East Asia-Pacific region. It has supported countries and private institutions in developing blue finance markets.

Sources: ET, World Bank, IFC