The Ministry of new and renewable energy(MNRE) has decided to ask the Reserve Bank of India(RBI) for removal of the priority sector lending limit for the renewable energy(RE) sector.
This will encourage the PSBs(public sector banks) to lend more for renewable energy projects and help RE developers access easy finance.
India is running the world’s largest renewable energy programme and plans to achieve 175 gigawatts(GW) of renewable energy capacity by 2022 as part of its climate commitments.
Priority Sector Lending is an important role given by the Reserve Bank of India (RBI) to the banks for providing a specified portion of the bank lending to few specific sectors.
Priority Sector includes the following categories:(a) Agriculture (b)Micro, Small and Medium Enterprises (c) Export Credit (d) Education (e) Housing (f) Social Infrastructure (g)Renewable Energy and (h)Others.
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