CHENNAI (Reuters) – India’s largest power producer, NTPC Ltd, on Wednesday said it would borrow 50 billion yen ($ 478 million) from Japanese banks to finance the installation of emission reduction equipment and green energy projects.

“The loan proceeds will be used by NTPC Ltd, the PSU under the Ministry of Energy, to finance its investments in flue gas desulphurization (FGD) and renewable energy projects,” said NTPC, managed by the government, in a press release.

Flue gas desulfurization (FGD) units reduce sulfur dioxide emissions – which are linked to lung disease and acid rain – from coal-fired power plants.

The Japan Bank for International Cooperation (JBIC) will provide 60% of the loan as part of its Global Action Initiative to Reconcile Economic Growth and Environmental Preservation (GREEN), NTPC said in a statement.

Other Japanese commercial banks, including Sumitomo Mitsui Banking Corp, San-In Godo Bank Ltd and Nanto Bank Ltd, will extend the remainder of the loan amount.

India has a phased plan for factories to meet emission standards, with deadlines going until the end of December 2022.

Data from the Central Electricity Authority (CEA) website shows that over 60% of coal-fired utilities have yet to award bids for the installation of emission reduction equipment .

Almost three-quarters of the factories that awarded bids for the installation of FGDs are factories managed by NTPC, according to the data.

The Association of Power Producers (APP), an industry lobby group, estimates that installing FGDs will take at least 27 months, putting more than 100 GW of coal-fired utilities – most of which are operated by private companies and provincial governments – at the risk of non-compliance.

According to CEA data, more than a sixth of factories have already missed a deadline to install FGDs.

India, currently struggling with some of the worst levels of air pollution in the world, has already twice extended the deadline for its utilities to meet emissions standards, after extensive lobbying by the APP.

(1 USD = 104.7000 yen)