New Delhi: The Asian Development Bank (ADB) plans to extend $1.2 billion in loans to India in calendar year 2026, the same as last year, as part of its broader push to strengthen climate resilience, accelerate clean energy transition and bolster sustainable infrastructure development in the country, a senior official at the multilateral bank said.
The financing spans multiple sectors, including clean energy, transport electrification, green hydrogen and power distribution reforms, Sujata Gupta, director, energy sector office, ADB, said in an interview. The support also includes technical assistance to strengthen policy frameworks and institutional capacity.
Gupta said that the multilateral development bank (MDB) has stepped up its support to India’s clean energy transition, backing a range of central and state initiatives aimed at achieving net-zero targets and expanding renewable energy capacity.
She said that India’s forward-looking policies and implementation models could serve as templates for other countries in South Asia and across Asia. Among the key programmes being supported is the PM Surya Ghar initiative, which promotes residential rooftop solar installations to boost distributed renewable energy generation.
Distributed renewable energy generation entails producing clean electricity locally, rather than of relying only on big, distant power plants.
The PM Surya Ghar: Muft Bijli Yojana is a demand-driven scheme that allows residential consumers with grid-connected electricity through their local distribution company to apply for rooftop solar installations. Since its launch in February 2024, 2,085,514 systems have been installed nationwide, benefiting 2,614,446 households as of December 2025.
ADB is also supporting the solarisation of agriculture, with a significant intervention underway in Maharashtra. The state government has structured a large programme that brings in private sector participation on the generation side while farmers remain the primary beneficiaries. ADB’s assistance includes strengthening distribution infrastructure and supporting generation through the state’s power distribution companies, Gupta said.
A major component of ADB’s engagement is its focus on “green skilling”. The programme seeks to build technical capacities among vulnerable groups, particularly women, to operate and maintain renewable energy infrastructure. According to Gupta, this approach not only creates employment at the grassroots level, but also ensures the long-term sustainability of assets. It is also expected to reduce distress migration from rural to urban areas by creating local job opportunities.
Beyond generation, ADB is working with financial institutions and utilities to scale up decentralised renewable energy systems, including battery energy storage solutions to strengthen grid reliability, she said.
At the policy level, ADB is providing technical assistance to the Union ministries of power and new and renewable energy to further refine regulatory frameworks and plan for long-term challenges. This includes examining circular economy solutions, such as managing and recycling solar panels at the end of their lifecycle over the next two decades.
She emphasised that the integrated approach—spanning infrastructure, finance, skills and policy—aims to ensure that India’s clean energy expansion remains sustainable, inclusive and future-ready.
She added that limited financial resources make innovative financing and stronger private sector engagement critical to meeting development and climate goals. "The scale of available resources with institutions such as the Asian Development Bank and other MDBs is inherently constrained. As a result, MDBs must increasingly focus on designing innovative financing mechanisms to maximise impact and crowd in additional capital," she added.
The strategy involves using sovereign loans and concessional funding as catalytic instruments to mobilise other sources of finance, including blended finance structures and co-financing arrangements. Leveraging limited MDB capital to attract private investment is seen as essential to bridge large infrastructure and clean energy funding gaps.