In News:

The Ghaziabad Nagar Nigam has become the first municipal body in India to issue a certified Green Municipal Bond, successfully raising ?150 crore to construct a Tertiary Sewage Treatment Plant (TSTP) — a major step toward sustainable urban water management.

What is a Green Municipal Bond?

A Green Municipal Bond is a financial instrument issued by Urban Local Bodies (ULBs) to finance projects with environmental benefits, such as:

• Renewable energy
• Water and wastewater treatment
• Pollution control
• Solid waste management

These bonds are aligned with international Green Bond Principles and require sustainability certification through independent third-party audits.

Key Features

• Targeted Use of Funds: Capital raised is exclusively allocated to environmentally certified projects.
• Independent Certification: Must meet Environmental, Social, and Governance (ESG) standards.
• Investor Confidence: Appeals to climate-focused investors, ESG funds, and global financial institutions.
• Municipal Creditworthiness: Encourages better financial management and credit ratings for ULBs.

Significance of the Initiative

• Supports SDGs: Contributes to UN Sustainable Development Goals, especially SDG 6 (Clean Water and Sanitation).
• Promotes Green Infrastructure: Enables low-emission urban development and enhances climate resilience.
• Enhances Water Security: Facilitates wastewater recycling, reducing dependence on freshwater sources.
• Replicable Model: Serves as a template for other municipalities to mobilize green capital for eco-projects.