IFC – the World Bank’s private sector financing arm – has announced its first investment in India’s green hydrogen industry. Its $25m equity investment will feed into a wider $105m package for Hygenco Green Energies, an Indian hydrogen supplier.
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German conglomerate Siemens AG’s financial services subsidiary will also participate in the transaction alongside a private equity strategy managed by Fullerton Fund Management.
In a statement, the IFC said its backing for green hydrogen is aligned with India’s energy transition – providing the country’s hard-to-abate sectors with a decarbonisation pathway.
“Green hydrogen has the potential to accelerate India’s energy transition by helping diversify the country’s fuel mix, strengthen industrial resilience, and decarbonize hard-to-abate sectors”, said Imad N Fakhoury, IFC’s regional division director for South Asia.
Fakhoury also highlighted the ‘hydrogen-as-a-service’ business model that Hygenco offers. “This partnership aims to scale a commercially viable model, pioneer Hydrogen-as-a-Service, and expand the supply of affordable and reliable green hydrogen solutions, while signalling confidence in the sector’s long-term growth potential”, he adds.
The government has extended support for India’s green hydrogen industry through production incentives for manufacturers. The National Green Hydrogen Mission – launched in 2023 – is backed by a financial commitment exceeding $2bn extending to 2030.
For Hygenco, the latest round brings blended institutional capital into its growth mix. Thus far, its leading investor has been a domestic venture capital fund – Neev II – backed by State Bank of India’s venture capital arm and the European Investment Bank among others. Neev II deployed $25m in equity in Hygenco nearly four years ago.
“Witnessing the subsequent mobilization of global institutional capital behind this platform validates our investment thesis”, commented Akshay Panth, CIO of Neev II fund.
The transaction is expected to reach full close following fulfilment of precedent conditions.
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