Swisscontact to 'launch 'InSPIRE' challenge fund to boost green energy transition in RMG sector

Swisscontact Bangladesh, supported by the Embassy of Sweden, is set to launch the first window of the InSPIRE Challenge Fund at the end of this month, aiming to accelerate the adoption of renewable energy and energy efficiency in Bangladesh's Ready-Made Garment (RMG) sector.

The announcement was made during a high-level industry consultation workshop held at a reputed hotel in Dhaka today, attended by representatives from the Swedish Embassy, BGMEA, BKMEA, global brands such as H&M, Inditex, and Marks & Spencer, banks, financial institutions, and renewable energy businesses, said a press release.

The initiative seeks to de-risk private investment in green energy by offering grants that cover up to 40% of project costs, while factories are expected to co-finance the remaining 60%. The amount of the Challenge Fund grant varies by project, ranging from one to five lakh Swedish Krona (SEK).

The workshop began with a welcome address by Helal Hossain, country director of Swisscontact Bangladesh. The opening remarks were delivered by  Ikramul H. Sohel, senior Programme officer, Inclusive Economic Development at the Embassy of Sweden.

Maria Stridsman, deputy head of Mission at the Swedish Embassy, stressed the importance of collective action in her opening remarks.

"Bangladesh's RMG sector is the backbone of its economy, and its green transition will have far-reaching environmental and social impacts. Through InSPIRE – the Initiative to Stimulate Private Investment for Resource Efficiency – we aim to incentivize scalable solutions to reduce carbon emissions," she said.

The InSPIRE fund is not a loan, but a performance-based grant, designed to bridge financing gaps for mid- and low-tier factories and energy service providers. "We want factories to see that sustainability is not just a cost but a competitive advantage," said Syeda Ishrat Fatema, deputy country director of Swisscontact. Bidoura Tahmin Khan, Team Leader of InSPIRE, explained that the grants will be categorized into small (6–12 months) and medium (up to 24 months) funding windows to support both pilot projects and high-impact scalable solutions.

The first call for concept notes will open by the end of May, with a four-week submission period. Projects must focus on areas such as solar energy, biomass-based technologies, energy-efficient machinery, or water conservation. They must also align with Bangladesh's national goal of sourcing 40% of its electricity from renewables by 2041. Azmal Huda, InSPIRE's MRM Manager, noted that technically sound projects with gender-inclusive policies and no double funding will be prioritized.

Global brands expressed strong support for the initiative. A representative from H&M said, "We collaborate closely with our suppliers on energy audits and co-financing to drive efficiency and reduce emissions." Inditex shared its roadmap to cut emissions across its supply chain by 2027, urging factories to adopt cleaner technologies. ESCOs (Energy Service Companies) echoed the need for stronger partnerships with brands and banks to ensure the long-term success of green transitions for RMG factories.