Economic Development > Indian Economy and Issues > Financial market
Why in news?
- SEBI has proposed the concept of blue bonds as a mode of sustainable finance, saying such securities can be utilized for various blue economy-related activities, including oceanic resource mining and sustainable fishing.
About Blue Bonds:
- A blue bond is a debt instrument issued by governments, development banks or others to raise capital from investors to finance marine and ocean-based projects that have positive environmental, economic and climate benefits.
- Like the conventional bonds, investors lend money to a bond issuer, who agrees to repay the interest every year for the term of the bond plus the capital on a certain day.
- Similarly, in a blue bond, earnings are generated from the investments in sustainable blue economy projects.
- The issuance of a blue bond enables investors to fulfil their corporate social responsibilities and generate benefits for the ocean and humankind.
- The Republic of Seychelles launched the world’s first sovereign blue bond in 2018 raising a total of $15 million to advance the small island state’s blue economy.
Benefits of Blue Bond:
- It offers an opportunity for private sector capital to be mobilized to support the blue economy.
- It helps in raising awareness about important marine issues while providing much-needed funding to projects.
- It will catalyze progress towards SDG 14 (Life Below Water).
Consider the following statements:
1. Blue bond is a debt instrument issued to raise capital to finance marine and ocean-based projects that have positive environmental benefits
2. India is the first country to issue sovereign blue bond
Which of the statements given above is/are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2