Japan Bank for International Cooperation ( JBIC ) has signed a 60 billion yen ( US$408 million ) loan agreement for renewable energy and next-generation energy and heat supply projects in India.

The loan is co-financed with Sumitomo Mitsui Banking Corporation ( SMBC ), The Joyo Bank, Kansai Mirai Bank, and Kiraboshi Bank. JBIC is contributing 36 billion yen and providing a guarantee for the portion co-financed by private financial institutions.

The borrower is Power Finance Corporation Limited ( PFC ), a government financial institution in India.

The loan is extended as part of JBIC’s GREEN operations, and is intended to provide the Indian company Assam Bio Ethanol Private Limited ( ABEPL ) via PFC with the funds necessary for a biofuel production and power generation project in the state of Assam.

In this project, ABEPL will produce biofuel in Golaghat district, Assam, using bamboos cultivated in India’s northeastern states. It will sell bioethanol, its main product, for use in gasoline blends.

According to JBIC, electricity demand in India remains strong amid the rapid economic growth. However, the country, which is the world's third largest emitter of carbon dioxide, urgently needs to address climate change.

Under the National Policy on Biofuels, which was formulated in 2018 and revised in 2022, the government aims to achieve a 20% bioethanol blend in gasoline to replace fossil fuels and contribute towards climate change mitigation. In June 2021, the government also released the Roadmap for Ethanol Blending in India, which outlines plans to roll out E20 fuel ( a mix of  80% petrol and 20% ethanol ) nationwide from 2025.