Abraaj Group, Aditya Birla partner on solar in India


The Dubai-based Abraaj Group, a leading investor operating in global growth markets, and Indian conglom Aditya Birla Group, have joined forces to build a gigawatt-scale renewable energy platform focused on developing solar power plants in India.

Abraaj will invest in the platform through one of its funds while Aditya Birla will invest through its Aditya Birla Nuvo Limited division.

Abraaj and Aditya Birla have launched their joint endeavor “at an opportune time in the growth of the Indian renewable energy sector,” the companies said in a statement. They point out that demand for Power in the country is growing as a result of the country’s expanding population, increasing urbanization and related economic activities.

“At the same time, the Indian government has created favorable regulatory policies to increase the use of renewable energy, including setting an explicit target to achieve 100 GW of solar power capacity by 2022, compared to the current installed capacity of 4 GW. Together, these factors create a compelling investment opportunity for the private sector, which can help meet this significant demand for renewable energy.”

The new solar power platform will bid for projects tendered at national and state auctions with the aim to develop and operate utility-scale solar power plants that can provide cost-effective electricity to the national grid across several key states.

“The gap in energy infrastructure in growth markets translates into a long-term and sustainable investment opportunity,” said Sev Vettivetpillai, partner and global head of Abraaj’s Thematic Funds Business. “Renewable energy is set for explosive growth thanks to technological advances, favorable policies and pricing structures that make it a competitive alternative to conventional power generation. At Abraaj, we see significant opportunity in India, one of the world’s biggest energy consumption markets.”

Fellow Abraaj partner Mustafa Abdel-Wadood, the group’s global head of its Regional Funds Business, added, “The renewable energy sector in India offers vast potential for growth and can play a transformative role in reducing dependency on fossil fuels and enhancing India’s long-term energy security.”

Abdel-Wadood said the two companies were “creating a landmark investment that can address the demands for clean energy infrastructure in the country.”

Dev Bhattacharya, who oversees solar power at Aditya Birla, said the group supported the Indian government’s initiative for a greater share of renewables in the energy mix, which he said was “essential for sustained economic and industrial growth.” The new partnership with Abraaj “will give a fillip to Aditya Birla Group’s renewable energy initiatives and contribute to reducing the carbon footprint of India as a whole,” he added.

India’s ambitious solar development goals have attracted a great deal of attention from global players. The German government this week pledged some €1 billion ($1.12 billion) to support India’s solar energy expansion through a German-Indian solar partnership.

The Abraaj Group has invested some $1 billion through 10 investments in global growth markets.