Multilateral Investment Guarantee Agency (MIGA) and International Solar Alliance (ISA) have announced the establishment of MIGA-ISA Solar Facility, a multi-donor trust fund.

• MIGA, part of World Bank Group, aims to promote cross-border investment in developing countries by providing guarantees (political risk insurance and credit enhancement) to investors and lenders. (India is a member). 

About MIGA-ISA Solar Facility

• It will combine ISA’s technical expertise and MIGA’s capacity to mobilise financing, creating an innovative mechanism to accelerate global adoption of solar energy, including cutting-edge solar energy technologies.
• Applicability: Initially, focus on Sub-Saharan Africa, with plans for global expansion.
• Funding: ISA has committed seed-funding of $2 million, with a goal of raising $10 million for facility. 
  • This is the first program under guarantee component of ISA’s Global Solar Facility (GSF), which aims to raise $200 million for projects in Africa.
    • GSF aims to catalyse solar investments (through payment guarantees, insurance and investment funds) across the world, starting with Africa’s underserved segments. 
• Significance
  • Provides cost-effective risk mitigation instruments to support growth of solar projects in ISA member countries.
  • Attract private investment by providing concessional financing (including first-loss instruments and reinsurance capacity), helping to lower costs and close energy gap in underserved regions.