Sagarmala Finance to Issue India’s First Blue Bond

Sagarmala Finance Corporation, India’s state-owned maritime-focused lender, is set to issue the country’s first ‘blue bond’ as it diversifies funding sources to support maritime and coastal infrastructure development, Managing Director L.V.S. Sudhakar Babu told Reuters on May 29, 2026.

Blue Bond Overview

A blue bond is a debt security aimed at raising funds for ocean- and water-related projects, targeting investors with a mandate to invest in environmentally focused securities. While green bonds used to fund climate change-related projects have seen considerable uptake, Sagarmala’s debt would be a first-of-its-kind blue bond in India.

Globally, just over $15 billion in blue bonds had been issued by mid-2025, according to World Bank data. In 2020, the Bank of China issued Asia’s first blue bond, while some island nations like Seychelles have also raised debt via such securities.

Issue Details

Sagarmala plans to raise up to ₹10 billion ($105.08 million), including a greenshoe option of ₹5 billion. While the exact tenor and rate are yet to be decided, the company plans to use the bond issue for longer-term borrowing.

Sagarmala’s existing term loans have an average tenor of 3.5 years, while the average tenor of loans it disburses is about 12 years, creating an asset-liability mismatch, Babu explained.

Trust Capital, AK Capital and Tipsons have been appointed as advisers to the bond issue, for which a date is yet to be finalized. “This will happen when the market is conducive and yields stabilise,” Babu said.

Market Context

India’s benchmark 10-year yield has risen around 35 basis points since the start of the U.S.-Iran war, denting activity in the bond market.

Funding Plans

Reuters had earlier reported that Sagarmala plans to raise as much as ₹100 billion in financial year 2027 to finance projects that strengthen India’s maritime ecosystem, including greenfield and brownfield ports, last-mile port connectivity, shipbuilding, inland waterways and coastal road networks.

The company also administers the government’s ₹250-billion Maritime Development Fund, which includes a ₹50-billion Interest Incentivisation Fund, allowing it to provide interest subsidies to borrowers.

Sagarmala is also seeking a ₹20-billion equity infusion from the government to maintain a healthy debt-to-equity ratio as it expands its loan book.

Company Background

Established in 2016 under India’s Ministry of Ports, Shipping and Waterways, Sagarmala received a non-banking financial company licence in June 2025.