International Finance Corporation to invest in GEF Capital’s India-focused clean energy fund

By Bruhadeeswaran R

  • 21 May 2021
International Finance Corporation to invest in GEF Capital’s India-focused clean energy fund
Credit: VCCircle

The World Bank’s International Finance Corporation (IFC) has said that it is committing an equity investment of up to $15 million (Rs 109 crore) in an India-focused clean energy fund managed by GEF Capital Partners. 

The investment will be capped at 20% of the total capital commitments that will be made to South Asia Growth Fund (SAGF) II whose corpus target is $200 million.  

In early May, VCCircle reported that the fund may make a final close of fundraising by June-end and is expecting to overshoot its fundraise target. 


The IFC disclosure said the fund is looking to invest in 8-10 companies focused on clean energy supply and resource efficiency in India and, opportunistically, in Bangladesh. 

The fund is among the few private equity vehicles that support small and medium-sized businesses operating in the underserved energy and water efficiency market.

In 2018, it made an initial investment in ESDS Software Solution Pvt Ltd, which sets up data centres based on eco-friendly technologies. 


In December 2019, the fund invested Rs 106 crore in PVC pipes maker Prince Pipes and Fittings Ltd. 

South Asia Growth Partners II, LP, a limited partnership organised under the laws of Ontario, Canada, is the general partner of the fund. 

The fund's offshore sponsor is GEF Capital Partners, LLC, a Delaware limited liability company. GEF Capital was founded in 2018 and is led by Raj Pai, Sridhar Narayan and four other partners.


SAGF II had earlier targeted $150 million but increased the proposed corpus size by a third after receiving a higher commitment from US investor International Development Finance Corporation, VCCircle reported in June 2020.

GEF Capital was spun out of US-based Global Environment Fund Capital Advisors in 2018, as an investment manager to develop Global Environment Fund’s middle-market and growth equity investment programmes in North America, South Asia and Latin America. SAGF II came a decade after the Global Environment Fund teamed up with Yes Bank for its first South Asia vehicle in 2008.  

SAGF II hit its first close, a fundraise milestone after which a fund can deploy money for investments, in May 2019 after securing $130 million.  


This included $115 million from seven European investors including UK-based CDC Group Plc, France’s Proparco, Dutch development bank FMO and the Swedish government’s Swedfund.  

CDC, the UK government's development finance institution, anchored SAGF II with a $25 million  

commitment. Other investors were Belgian Investment Company for Developing Countries, European Investment Bank and Swiss Investment Fund for Emerging Markets.  


The 10-year closed-end investment fund focuses on energy efficiency and clean energy. While its focus region is India, it also has an eye on Bangladesh. 

Global Environment Fund was established in the 1990s. GEF Capital makes investments in the range of $10-40 million in businesses that have an operating profit of at least $3 million, according to its website.  

In September 2020, VCCircle reported that GEF Capital had recruited a senior fund manager from a homegrown private equity firm to strengthen its India team. 

GEF Capital’s India team includes Mumbai-based Narayan and Pai, co-heads of South Asia investment practice.

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