{"id":15297,"date":"2023-09-28T07:28:58","date_gmt":"2023-09-28T01:58:58","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=15297"},"modified":"2025-04-03T09:52:18","modified_gmt":"2025-04-03T04:22:18","slug":"social-bonds","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/social-bonds\/","title":{"rendered":"What are Social Bonds?"},"content":{"rendered":"<h2><strong>About Social Bonds<\/strong><\/h2>\n<ul>\n<li>Social bonds, also known as\u00a0<strong>social impact bonds and abbreviated as SIB<\/strong>, are the type of bond where the bond issuer is\u00a0<strong>gathering funds for a project that has some socially beneficial implications.<\/strong><\/li>\n<li>These bonds are\u00a0<strong>designed to finance projects that address various social issues<\/strong>, such as healthcare, education, affordable housing, poverty alleviation, and environmental sustainability.<\/li>\n<li>The\u00a0<strong>Pimpri Chinchwad Municipal Corporation (PCMC) in Maharashtra&#8217;s Pune<\/strong>\u00a0<strong>and United Nations Development Programme (UNDP) in 2020 co- created India&#8217;s inaugural SIB.<\/strong><\/li>\n<li><strong>Features of Social Bonds issued by NABARD:<\/strong>\n<ul>\n<li>This is the\u00a0<strong>first externally certified AAA-rated Indian Rupee-denominated SIB<\/strong> in the country. The bonds have been\u00a0<strong>rated &#8216;AAA&#8217; by CRISIL and ICRA.<\/strong><\/li>\n<li>The\u00a0<strong>base issue size of the social bonds was \u20b91,000 crore<\/strong>, with an\u00a0<strong>option to retain oversubscription up to \u20b92,000 crore,\u00a0<\/strong>thereby aggregating up to Rs 3,000 crore.<\/li>\n<li>The\u00a0<strong>face value of each bond is \u20b91 lakh<\/strong>.<\/li>\n<li><strong>Maturity: 5 years<\/strong><\/li>\n<li><strong>Coupon Rate: 7.63 per cent.<\/strong><\/li>\n<\/ul>\n<\/li>\n<li><strong>Sustainability Bond Framework:<\/strong>\n<ul>\n<li><strong>NABARD recently announced a Sustainability Bond Framework<\/strong>, which seeks to finance and\u00a0<strong>refinance new or existing eligible green and social projects.<\/strong><\/li>\n<li><strong>Eligible social projects include affordable basic infrastructure, access to essential services,<\/strong> affordable housing, employment generation, food security, socioeconomic advancement, and empowerment.<\/li>\n<li><strong>Projects that promise energy efficiency, including green buildings, energy storage,\u00a0<\/strong>and smart grids, would also be eligible to\u00a0<strong>get funding through the new breed of bonds that NABARD is rolling out.<\/strong><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<h3>Key Facts about NABARD:<\/h3>\n<ul>\n<li><strong>It is a financial institution<\/strong> that was set up by the Indian government\u00a0<strong>to promote sustainable agriculture and rural development in the country.<\/strong><\/li>\n<li>It is the\u00a0<strong>main regulatory body in the country\u2019s rural banking system.<\/strong><\/li>\n<li><strong>Formation:<\/strong>\n<ul>\n<li>It was\u00a0<strong>established in 1982<\/strong> as a\u00a0<strong>central regulating body for agriculture financing and the rural section.\u00a0<\/strong><\/li>\n<li>The government of India established NABARD\u00a0<strong>under the outlines of the National Bank for Agriculture and Rural Development Act 1981.<\/strong><\/li>\n<\/ul>\n<\/li>\n<li><strong>Objective<\/strong>:\u00a0<strong>Promoting agriculture and rural development through participative financial and non-financial intervention<\/strong>s, innovations, technology and institutional development for securing prosperity.\u00a0<\/li>\n<li><strong>Some of the activities undertaken by NABARD for rural development include:<\/strong>\n<ul>\n<li>Provision of\u00a0<strong>refinance support<\/strong><\/li>\n<li><strong>Improving rural infrastructure<\/strong><\/li>\n<li><strong>Supervision of Regional Rural Banks (RRBs) and Cooperative Banks<\/strong><\/li>\n<li><strong>Training artisans<\/strong> to develop handicraft activities and offering them\u00a0<strong>help in marketing their produce<\/strong><\/li>\n<li><strong>Preparation of credit plans at a district level<\/strong> and encouraging banks to achieve these targets<\/li>\n<li><strong>Development of sound banking practices\u00a0<\/strong>within the economically backward sections of India<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<hr \/>\n<h3>Q1) What are Bonds?<\/h3>\n<p>Bond is a fixed-income instrument that represents a loan from an investor to a borrower. It is a contract between the investor and the borrower, where the borrower uses the money to fund its operation and the investors receive interest on the investment<\/p>\n<p><strong>Source: <\/strong><a href=\"https:\/\/www.cnbctv18.com\/finance\/social-bonds-explained-as-nabard-raises-rs-1040-crore-via-its-inaugural-issue-17886131.htm\" target=\"_blank\" rel=\"nofollow noopener\"><u>Social bonds explained as NABARD raises Rs 1,040 crore via its inaugural issue<\/u><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Social bonds are the type of bond where the bond issuer is gathering funds for a project that has some socially beneficial implications. <\/p>\n","protected":false},"author":5,"featured_media":15298,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[],"class_list":{"0":"post-15297","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-upsc-prelims-current-affairs","8":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/15297","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=15297"}],"version-history":[{"count":0,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/15297\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/15298"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=15297"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=15297"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=15297"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}