Overview

• The Central Board of Direct Taxes’ notification, effective July 9, designates IREDA bonds redeemable after five years as specified assets under Section 54EC of the Income-tax Act.
• Eligible investors can defer tax on long-term capital gains up to ₹50 lakh by investing in these green bonds within a fiscal year.
• Proceeds from the bonds will be exclusively allocated to renewable energy projects capable of servicing debt through their own revenues.
• IREDA expects lower borrowing costs and increased capital availability to support India’s target of 500 gigawatts of non-fossil fuel capacity by 2030.
• Market participants anticipate strong subscription interest as tax incentives align with national climate goals and green financing strategies.