Six South Asian nations, including India, are set to benefit from a new USD$ 21.5 million (EUR 18 million) funding from the European Union (EU), which will help to accelerate climate-smart, inclusive infrastructure investments in their regions.

The International Finance Corporation (IFC) will implement the project under the program- Accelerating Climate-Smart and Inclusive Infrastructure in South Asia (ACSIIS). ACSIIS is a five-year program (2021-2026) to help spur investments in energy, water, waste management, transport, logistics, and green buildings to benefit people and businesses in Bangladesh, Bhutan, India, the Maldives, Nepal, and Sri Lanka. ACSIIS would leverage USD$ 850 million of private sector investments in the region.

According to IFC, the impact of COVID-19 on investments in infrastructure has been widespread and severe. “Investment commitments in infrastructure with private participation in 2020 dropped by an unprecedented 52 percent from 2019 levels.”

IFC estimates that South Asian countries can unlock more than US$3 trillion of climate-smart investment opportunities by fully meeting the national targets under the Paris Agreement by 2030.

The program will also support the development of climate-smart investments in agriculture, manufacturing, tourism, health, and education while focusing on key themes such as cities, gender, and green finance. The latest initiative builds on IFC’s previous partnership with the EU to support the Eco-Cities Program in India and other programs in the region.

According to IFC, through ACSIIS, it will support early-stage market development to address key market-wide constraints, as well as deliver project-level technical advice to structure sustainable infrastructure investments for the target countries. “The program will also support capacity building of private and government sectors to improve their ability to design, structure, and implement sustainable infrastructure projects. Several of these components are part of IFC’s Upstream strategy, which aims to create markets in the most challenging environments, laying the foundation for future investment projects,” the organization said in a statement.