India’s first blue bond sale nears as issuers prepare water, maritime projects

Mumbai: India’s first blue bond issuance is expected to take place by the end of September, with state-run Sagarmala Finance Corp and Vadodara Municipal Corp preparing to tap the emerging market for funds aimed at ocean- and water-related projects.

Sagarmala Finance Corp, a government-owned lender focused on India’s maritime sector, is considering raising up to ₹10 billion ($104.5 million) through blue bonds. Managing Director L.V.S. Sudhakar Babu told Reuters that the institution could tentatively target the last week of September for the issue.

The financing would support projects linked to India’s maritime ecosystem, including port connectivity, shipbuilding, inland waterways and coastal road infrastructure.

Vadodara Municipal Corp is also preparing a potential ₹2 billion blue bond issue, according to two merchant bankers familiar with the plans. The issuance is awaiting regulatory approvals.

The proposed Vadodara bonds have received an AA+ rating from India Ratings and are expected to finance capital expenditure for a pump house, a water treatment plant and a clear-water reservoir.

Blue bonds are debt securities designed to finance projects associated with the protection and sustainable use of oceans and water resources. They are increasingly attracting investors with environmental, social and sustainability mandates.

Globally, more than $15 billion in blue bonds had been issued by mid-2025, according to the World Bank.

The planned Indian issuances would mark an important development in the country's sustainable finance market, expanding beyond traditional green bonds and directing capital towards water management and maritime infrastructure.

For India, the move comes as authorities and financial institutions seek new sources of long-term financing for infrastructure while addressing water security, environmental protection and the development of the country's extensive coastal and inland water networks.