SBI Signs €100 Million Green Finance Agreement with AFD at GIFT City

In a major step towards advancing India’s climate action and sustainable development agenda, the State Bank of India (SBI) has signed a €100 million (approx. ₹900 crore) line of credit agreement with the Agence Française de Développement (AFD) at its GIFT City branch in Gujarat.

The agreement marks a significant milestone in green finance, a sector gaining global momentum as countries and corporations race to align with net zero and climate resilience goals. With this pact, India’s largest lender strengthens its commitment to promoting sustainable projects, while also tapping into international expertise in innovative financing and climate technologies.

Boosting India’s Green Financing Landscape

The newly signed agreement is designed to channel funds into climate mitigation and adaptation projects across India. This includes initiatives that directly reduce greenhouse gas emissions as well as projects aimed at improving resilience against the growing risks of climate change.

An SBI spokesperson explained that the bank has been actively raising credit lines from multilateral and development finance institutions to support the country’s transition to a low-carbon economy. The agreement with AFD is the latest in a series of partnerships that highlight SBI’s role as a catalyst for sustainable growth.

SBI has set a clear target: to expand the share of its green portfolio to 7.5–10% of its domestic advances by 2030. This aligns with India’s broader climate commitments under the Paris Agreement and its pledge to achieve net zero by 2070.

Partnership with AFD: More than Just Funding

Beyond financial support, the agreement provides SBI access to AFD’s deep expertise in climate finance, project structuring, and environmental, social and governance (ESG) integration. AFD, France’s premier development finance institution, is renowned for backing global projects that combine economic growth with social and environmental responsibility.

This collaboration will also help SBI adopt innovative green technologies and refine its sustainability frameworks, making it easier to finance complex climate projects that often require blended finance solutions.

“This agreement is not only about capital but also about knowledge-sharing and capacity-building. By drawing on AFD’s experience in global climate finance, SBI will be better equipped to fund projects that deliver measurable environmental impact,” said a senior SBI official.

Why GIFT City Matters

The signing at GIFT City, Gujarat—India’s flagship international financial services hub—underscores the role of the city as a rising centre for sustainable and green finance in Asia. GIFT City has been steadily positioning itself as a gateway for international investors and lenders looking to participate in India’s growth story.

Hosting the agreement there highlights the strategic synergy between India’s financial infrastructure ambitions and its sustainability roadmap. By leveraging GIFT City’s international ecosystem, SBI is able to strengthen cross-border collaborations in climate finance.

SBI’s Growing Sustainability Commitment

As of June 2025, SBI reported deposits exceeding ₹54.7 lakh crore, making it the country’s largest lender with unmatched reach and influence. While its focus remains on digital transformation and financial inclusion, the bank has increasingly woven sustainability into its growth strategy.

In recent years, SBI has:

• Funded large-scale renewable energy projects, including solar and wind farms.
  
• Supported energy efficiency programs in industrial and commercial sectors.
  
• Introduced financing mechanisms for electric mobility and green infrastructure.
  
• Strengthened its internal ESG risk assessment frameworks.
  

This agreement with AFD further reinforces the bank’s credibility as a green finance leader in India’s banking sector.

The Global Context of Green Finance

Green finance has emerged as a defining theme in international development, with institutions and governments worldwide recognising the urgency of channeling capital into sustainable projects. The EU’s Carbon Border Adjustment Mechanism (CBAM), growing ESG investor demands, and the push for transparent carbon reporting have all increased the pressure on developing economies to scale up climate financing.

India, with its ambitious climate targets and rapid economic growth, is seen as a crucial test case for balancing sustainability with development. By partnering with global institutions like AFD, SBI ensures that India’s financial ecosystem keeps pace with international climate standards while mobilising the funds required for large-scale transformation.

Voices from the Partnership

Commenting on the development, SBI’s senior leadership emphasised the importance of long-term resilience building in the face of climate risks.

“Our partnership with AFD not only strengthens financial flows into sustainable projects but also brings in invaluable technical expertise. Together, we are driving a new era of green finance in India,” said the SBI official.

AFD representatives highlighted India’s pivotal role in global climate action:

“India is central to the world’s decarbonisation journey. By working with SBI, we are ensuring that climate finance delivers both local impact and global benefits,” an AFD spokesperson noted.

A Greener Banking Future

The SBI-AFD green finance pact is more than a standalone deal—it sets the tone for future collaborations that will likely expand in both scale and scope. From renewable energy and climate-smart agriculture to sustainable urban infrastructure and climate-resilient technologies, the agreement could pave the way for billions of euros in cumulative green investments over the next decade.

As India prepares to position itself as a global leader in climate solutions, partnerships like this will ensure that the country has both the financial muscle and the technical expertise to succeed.

A Strong Signal for Sustainable Growth

The €100 million green finance agreement between SBI and AFD at GIFT City is a landmark step towards aligning India’s financial sector with its climate and sustainability goals. It reflects not only SBI’s ambition to expand its green portfolio but also India’s commitment to fostering international cooperation in addressing the climate crisis.

With access to AFD’s expertise and GIFT City’s international platform, SBI is poised to play a transformative role in financing India’s green transition. This pact signals a powerful message: India’s largest bank is ready to lead the way in embedding sustainability at the heart of finance.

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