What happens to clean infrastructure finance when countries are big and fast-growing but have immature financial systems and a scarcity of long-term domestic investors? The Climate Policy Initiative (CPI) compares two different financing models from middle income countries: the highly centralized model of Brazil and the decentralized model from India.
Dec 2015
What happens to clean infrastructure finance when countries are big and fast-growing but have immature financial systems and a scarcity of long-term domestic investors? The Climate Policy Initiative (CPI) compares two different financing models from middle income countries: the highly centralized model of Brazil and the decentralized model from India. While evaluating the strengths and weaknesses of each model, the paper finds that despite differences, both countries end up with public financing dominating clean infrastructure projects with similar levels of leverage in both. Brazil’s centralized development banking did foster greater scale than India, but the Indian model can better attract commercial and international development sources. The paper explores further insights learned from comparing the two models.
Working Papers