New Delhi: Shri Pradip Kumar Das, Chairman & Managing Director of the Indian Renewable Energy Development Agency Ltd. (IREDA), today hailed the Central Board of Direct Taxes (CBDT) notification classifying IREDA bonds as ‘long-term specified asset’ under section 54EC of the Income-tax Act, 1961. This significant policy initiative, effective July 9, 2025, is poised to dramatically bolster financing for India’s burgeoning renewable energy sector.
A visibly pleased Shri Das expressed profound gratitude to the Ministry of Finance, Ministry of New & Renewable Energy, and the CBDT. “This valuable policy initiative is a testament to the government’s unwavering commitment to sustainable development and a strong affirmation of IREDA’s pivotal role in accelerating renewable energy financing across the nation,” he stated.
Under the new notification, bonds issued by IREDA on or after July 9, 2025, with a redemption period of five years, will qualify for capital gains tax exemption benefits under Section 54EC. This allows eligible investors to save tax on Long Term Capital Gains (LTCG) up to an impressive Rs. 50 Lakhs in a financial year by investing in these bonds.
Shri Das emphasized the dual benefit of this decision. For IREDA, it translates into a lower cost of funds, a crucial advantage for the capital-intensive renewable energy sector. For investors, it opens up an attractive and secure avenue for tax-saving, which is expected to draw wider participation and inject significant capital into green energy projects.
“The tax-exempt status for our bonds will not only offer an attractive investment avenue for individuals and entities but also ensure increased capital availability for vital green energy projects,” Shri Das underscored. He further highlighted that the proceeds from these bonds will be exclusively channeled into renewable energy projects capable of self-sustaining debt servicing, reducing any dependence on State Governments.
This strategic move is a crucial step towards India’s ambitious target of achieving 500 GW of non-fossil fuel capacity by 2030, a goal IREDA has been instrumental in pursuing. Shri Das reiterated IREDA’s commitment to driving India’s clean energy transition, noting that the enhanced capital flow will directly contribute to the expeditious development of the renewable energy sector, solidifying India’s position as a global leader in green energy.
The notification marks another significant feather in IREDA’s cap, reinforcing its leadership in renewable energy financing and its dedication to a sustainable future for the nation.