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RPower secures $5 b funding from US Exim Bank

08 Nov 2010 Evaluate

Anil Ambani-led Reliance Power announced a deal to secure $ 5 billion (nearly Rs 22,000 crore) in funding from the US Export Import Bank for gas-based and renewable energy projects totalling about 9,000 MW. The deal coincides with the three-day visit of US President Mr Barack Obama to India. RPower also had announced a deal yesterday in the presence of Mr 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.

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 o f gas fired thermal electric generating technology. This would be in addition to the $ 917 million from 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 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.

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