Although not India’s first sub-sovereign green issuance, it comes soon on the heels of India’s maiden issuance of INR 16,000 crore (~USD 2 billion) worth of sovereign green bonds in two tranches. The pricing advantage achieved in the sovereign issuance and the 5.91x oversubscription garnered by the Indore Municipal Corporation are powerful indicators of the appetite for green at all levels.

A record USD 3.6 billion was raised by Indian RE developers in international debt capital markets in the first six months of 2021, but that was during a low dollar interest rate environment. With rising USD interest rates, raising money overseas has become increasingly expensive. Will this sub-sovereign issuance also spur growth in the domestic INR corporate green bond market?