(CNSNews.com) - The U.S. Export-Import Bank, an independent agency of the federal government, says that it has $500 million in loans in the “pipeline” to fund new solar energy projects—in India.
The $500 million in new loans will come on top of $75 million in financing that the Export-Import Bank has already provided this year for solar power projects in India.
“In fiscal year 2011 to date, the Bank has approved financing totaling approximately $75 million for four solar projects in India,” the bank said in a July 18 press release. “The Bank also has about $500 million of India solar projects in the pipeline that will generate an estimated 315 MW of solar power.”
While in India last month, Export-Import Bank Chairman Fred Hochberg, an Obama appointee, announced two of the new solar projects the U.S.-government bank will be financing.
“In New Delhi, Hochberg announced authorizations totaling more than $25 million for two separate solar transactions,” the Export-Import Bank said in a July 19 statement. ”Ex-Im Bank is providing a $16 million, 16.5-year loan to Azure Power Rajasthan Pvt. Ltd. to purchase thin-film solar modules from First Solar Inc. in Tempe, Ariz, for the construction of a five-MW solar photovoltaic plant in the state of Rajasthan.
“Additionally,” the statement said, “Ex-Im Bank authorized a $9.2 million, 18-year loan for thin-film solar modules from Abound Solar Inc. in Loveland, Colo., to Punj Lloyd Solar Power Ltd. for the construction of a five- MW photovoltaic solar power plant in Rajasthan.”
On May 24, Hochberg told the House Subcommittee on International Monetary Policy and Trade that the Export-Import Bank is a lender of “last resort” that loans money for projects in other parts of the world that private-sector banks will not finance.
“I think that … much of global trade has moved to emerging markets, be that Turkey, be that India, South Africa. And, candidly, after the financial crisis in particular, banks are more reluctant to lend to those parts of the world …,” Hochberg told the committee.
“So we really act as a lender of last resort,” Hochberg testified. “We act when--If other banks are unwilling or unable to provide financial support, we will look at it and make sure there is a reasonable assurance of repayment, and in that case, we've been able to step in, with the private sector not able to do that on its own.”
The government-run bank says that by loaning money to fund projects in foreign countries that use goods and services from the United States it creates jobs within the United States.
“Ex-Im Bank is an independent federal agency that helps create and maintain U.S. jobs by filling gaps in private export financing at no cost to American taxpayers,” the bank said in its statement about the solar power investments in India.
The bank says that in the first half of this year alone it approved 173 transactions involving India that had a total value of $1.4 billion. This U.S.-government financing, the banks said, was responsible for “supporting over 10,000 U.S. jobs.”
That works out to $140,000 in U.S. government loans to borrowers in India for each U.S. job “supported” by the bank.