EIB Has Invested €1.2 billion In Development Of Metro Rails In India: Andrew McDowell, Vice President, EIB
In an interview with BW Businessworld, Andrew McDowell, Vice President, European Investment Bank, talks about EIB’s ongoing projects, partnership and more
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Andrew McDowell is one of the eight Vice Presidents of the EIB who, together with President Werner Hoyer, form the Management Committee that runs the bank on a day-to-day basis. In that capacity, Vice President McDowell has oversight of the Bank’s treasury, economics and evaluation functions, as well as lending operations in energy and the bioeconomy. He is also responsible for institutional relations with 10 European and 14 Asian countries. Prior to joining the EIB in 2016, Andrew was Chief Economic Adviser to Irish Prime Minister Enda Kenny from 2011, co-ordinating the policies that supported Ireland’s recovery from the economic crisis and sovereign bail-out. He took undergraduate and post-graduate studies in business, economics, finance and international relations from University College Dublin and John Hopkins University.
Please tell us about EIB’s climate partnership with the City of Vienna
The European Investment Bank (EIB) is stepping up its activities as the European Union`s Climate Bank, as a part of this new role we entered a climate partnership with the City of Vienna, the first such undertaking between the EIB and a European city. We agreed to join forces and combat climate change as well as increase our support for climate action projects in the city. This will improve the quality of living in the city and be beneficial for the entire planet.
Under this partnership, the EIB`s will enable financial support for housing, energy, waste and mobility projects in the city, and in particular projects improving climate protection.
Vienna is a pioneer in climate protection among European cities for over 20 years, with more than EUR 1bn invested in climate protection. This is an excellent track record in delivering projects that benefit both the climate and the people - such as projects optimizing Vienna's main wastewater treatment plant or projects offering comprehensive thermal renovation of municipal housing – is what makes us confident in the success of the cooperation.
For the EIB, partnerships like these are key for successful alignment of our financing with the goals of the Paris climate agreement - which is our key commitment since 2019. This can be a model of cooperation between the EIB and the cities all over the globe and I really look forward to expanding the network of our partner cities.
Please tell us about EIB’s ongoing projects in India that you are excited about
We are very proud of our contribution to better urban mobility in India. The EIB has invested EUR 1.2 billion in development of metro rails in Indian cities of Bhopal, Pune, Bangalore and Lucknow. These are all major infrastructural projects the EIB is extremely proud to support.
New metro lines make life more comfortable for the people of India. They shorten travel times, unlock new business and employment opportunities. They also increase trade, employment, social mobility… Metro lines are also an environment-friendly way to travel and they empower. With the introduction of female-only carriages on the trains, we have unlocked a new world of opportunities for Indian women – to be safe, educate themselves or find work easier.
Recently the EIB adopted a new energy lending policy. We will be phasing out of the support for fossil fuels and work towards a carbon-neutral Europe. For this purpose, we aim to mobilize EUR 1000 billion or one trillion euros for climate action projects across the world in an attempt to combat climate change and reduce the negative effects of global warming. India can benefit from this historic investment plan and I look forward to exploring the options with the public and private sector in the country.
Could you tell us a bit about the modalities of your investments in India? Do you undertake viability gap funding in the clean energy sector?
India has a very special place in the EIB history. Our first-ever operation in Asia was in India, back in 1993. Since then, we have invested EUR 3.4 billion in support of climate projects across the country, from renewable energy, urban mass transportation to micro, small and medium enterprises.
Over the years, we have contributed to India`s sustainability and climate preparedness, as all of our projects in the country were evaluated in terms of their technical, financial, environmental, social feasibility and their wider economic outcomes. We ensured India gets the best projects, just as it deserves.
The EIB’s investment in India broadly comprises both direct lending for large-scale projects in social and/or economic infrastructure, such as the metros, and lending through Indian partner banks for distributed small-scale projects undertaken by MSMEs. We worked extensively with the Indian financial sector, notably with the State Bank of India, IREDA, SREI, YES Bank, and IIFCL, and financed renewable energy infrastructure projects.
The Bank has over the past 6 years also invested in a number of equity funds focusing on renewable energy and energy efficiency projects in emerging markets. Through our dedicated fund of funds known as GEEREF or Global Energy Efficiency and Renewable Energy Fund we invested in three Asian funds, all of which are active in India, the Renewable Energy Asia Funds I & II, and Solar Arise. EIB made a tangible contribution to India`s energy security.
The Bank is also supporting India on the global stage. We work closely with the International Solar Alliance to promote the adoption of solar technology in the solar rich, developing and emerging economies. This was a global initiative launched in 2017 backed and promoted by the Honourable PM Modi and President Hollande at the UNFCC COP 21 in Paris and is currently hosted by the government in New Delhi. We are proud to support this new international role for India, a role that benefits the entire world.
What is your outlook and vision for India operations?
I am very excited about a new metro rail project we are about to start here in India as this means even more people and businesses will benefit from our activities in the country and partnership with Indian Government, public and private sector. I am also excited knowing that we can do much more!
The EIB can help and support India in greening its infrastructure and invest in new industry sectors such as offshore wind farms – creating clean energy, jobs and economic growth.
We will continue to support climate action projects in the country, as well as the development of country`s small and medium enterprises – our goals here would be to support the social and economic development of India while combating climate change and protecting the environment. Sound water and energy management projects in the country will also continue to have our support.
The EIB can also support India take up new leadership roles on the global stage – especially around the International Solar Alliance and the Coalition for Disaster Resilient Infrastructure – both key global initiatives of Indian Government. This is where Indian and European interests meet and where our partnership could make the world a better place.
While India focuses on its economic growth, will the move towards sustainable growth pose any challenges?
One hand yes, move towards sustainable growth will definitely pose challenges. On the other hand, this move will create great opportunities too. We need to be aware of these challenges but proactively focus on exploiting the opportunities. EIB can help here both with finances and expertise.
A good example of the kind of opportunities we will have is available investments. As a result of our commitment to sustainable growth, the EIB plans to mobilize up to EUR 1 trillion for climate action by 2030 alone. This will be available for climate action, social inclusion, infrastructure project and strengthen our businesses and communities.
EIB is excited to work together with countries like India to make sure negative effects of this transition are minimized, and benefits evenly spread, through know-how and technology exchange and provision of cheap finances. We are even ready to support our partners to develop sound and viable projects to be financed.
What is the agenda for the upcoming visit from the 29-31 Jan?
We are here to reconfirm EIB`s readiness to support the economic development of India and engage our partners to identify the best ways to do this. We will have meetings with government officials from Goa and Maharashtra. We will also meet representatives of companies running metro rails systems we have financed to learn from their experiences. We will also engage the local business communities in Pune and Mumbai to learn what they think about the future of urban transport and Climate Action finances.
It’s a great pleasure to visit India, enjoy its hospitality and learn from its business leaders and I really look forward to identifying new grounds for cooperation.