Asian Development Bank has embarked on a Green Housing initiative in India aiming to reduce carbon emissions and conserve water and energy.

The multilateral development body has tied up with low cost housing financier IIFL Home Finance towards this end. ADB is also planning to engage other institutional stakeholders including the Indian government, which has initiated a massive drive towards housing for all.

“IIFL is our partner for the technical assistance program. The program has a broad scope and reaches other key actors in the green affordable housing ecosystem in India to build capacity across a range of developers, other housing finance companies, and local /state/national government stakeholders,” Susan Olsen, ADB’s senior investment specialist for South Asia told ET.

The total project cost is pegged at $1 million and will be provided by ADB's Urban Climate Change Resilience Trust Fund. IIFL will also contribute an additional $0.15 million towards other costs.

This initiative will integrate green lending and climate adaptation strategies in the context of affordable housing in India.

“Buildings contribute around 35% of carbon emissions and with the vast majority of housing stock yet to be built in India, it can have devastating impact,” said Monu Ratra, chief executive at IIFL Home Finance. The dwelling units are responsible for about 40% of global energy consumption and about one-third of global greenhouse gas emissions, according to the World Economic Forum.

The Indian government had earlier set a target of building 50 million housing units by 2022 under its Housing for All initiative, with 60% of it being proposed in the rural areas. It has now scaled down the immediate target to 32.6 million by 2022 with 21.4 million in rural areas.

“If the home designs are sensitive to climate requirements, then it would consume less energy in the form of air conditioning. Another focus would be to improve the waste disposal system and recycling of water through rainwater harvesting,” Ratra said.

“This project attempts to create the ecosystem required to achieve these objectives,” he said.

ADB is also planning a series of activities on the market research and product innovation front to improve levels of understanding and awareness for both buyers and builders.

There will be efforts to develop a green affordable building ratings system to encompass tailored adaptations to the local climate zones of various regions across India, said Olsen. ADB will also take steps to promote and integrate green lending and climate adaptation strategies in the context of affordable housing, as well as identification of cost effective innovative green technologies that can help reduce costs and increase access to more sustainable building technologies in the affordable housing space.