SEWA was founded as a trade union in 1972 in Ahmedabad (Gujarat) by Ms. Ela Bhatt, supporting and organizing retrenched women workers of textile mills in the city. Today SEWA has a membership of more than 1.3 million across nine states, more than half of which are in the state of Gujarat. SEWA is a diversified family of more than 120 organizations. These organizations have various legal forms including companies, cooperatives, trusts and societies. The activities of the group include savings mobilization, lending, training and capacity building, and production/ marketing/rural distribution of products like textiles, agro commodities and construction materials.

The project outlay is estimated at $22 million for distribution of up to 200,000 cookstoves and solar lanterns to SEWA members. Subject to regulatory approvals, IFC (along with FMO, subject to internal approvals) will partially guarantee a loan from local banks to SEWA members. The IFC exposure will be up to $ 10 million subject to regulatory approvals.

1.75 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee	1.75
Loan
Equity

* These investment figures are indicative

The project envisages financing cookstoves and solar lanterns to SEWA members in India, primarily in the states of Gujarat and Rajasthan. However, the project is intended to serve as a template for replication in other states of India and elsewhere in South Asia.

1. Demonstration effect: Successful execution of this project will send a strong signal to the market that clean energy projects at the Base of the Pyramid are sustainable and can be commercially supported through collaboration with reputed institutions like SEWA who have a strong rural outreach. 2. Increased household incomes: Usage of energy efficient cookstoves and solar lanterns will increase household incomes by reducing expenses on firewood, kerosene and electricity and increasing availability of time for wage-earning activities. 3. Greenhouse Gases (GHGs) savings: The potential reduction in GHGs is estimated to be approximately 1 million tons of carbon dioxide equivalents over the life of the project. 4. Improved healthcare: Efficient cookstoves can reduce the risk of respiratory and other diseases amongst women and children. 5. Job Creation: The project envisages facilitating creation of micro-entrepreneurs and micro-franchisees involved in distribution and servicing of equipment.

1. Climate change at the Base of the Pyramid: IFC will bring its experience in Climate Change projects to structure and develop this project to provide for Climate Change solutions at the grassroots level. 2. Replication template: The project is one of the first in India and amongst the largest globally. Banks, donors, Climate Change agencies and potential investors are keen to learn from the project to replicate it on a larger scale in South Asia and Africa. IFC's involvement with the project including structuring and stakeholder management will provide comfort to other lenders / investors in participating in this project and also enable a replication of similar projects in South Asia and Africa. 3. Institution building: The successful completion of the project will create a self-sustaining model that can be followed with other institutions in other regions.

The project has been classified as a Category FI project according to IFC’s Environmental and Social Review Procedure. SEWA will be required to:
Develop a procedure relevant to its business process, prior to commitment, that is satisfactory to IFC, and that ensures that all its investments are screened and processed to avoid supporting activities on the IFC Microfinance exclusion list
Identify qualified persons to manage and implement the procedure
Demonstrate commitment and resources to implementing the procedure
Demonstrate commitment to applying the labor standards established by the IFC Performance Standard 2: Labor and Working Conditions
Submit a periodic report to IFC as per a format to be provided by IFC
Commit to establish a similar screening process to avoid supporting activities on the IFC Microfinance Exclusion List in MFIs in which it will invest