Which parts of a foundry does SIDBI's green loan treat as moderate risk, and is thermal sand reclamation allowed?
Melting, moulding and casting, cooling, finishing and sand recovery are Category B, with a site-specific environmental plan. Raw material preparation and scrap recycling after finishing are low-risk Category C. Thermal sand reclamation is allowed only at MSME scale, with effective air pollution control, shown by due diligence to be reversible and fully mitigable.
Category B: moderate risk
The reason given: high-temperature work, air emissions, dust, waste handling and worker health and safety. Category B needs an environmental and social impact assessment and plan, with 30 days of advance disclosure before the GCF Board considers it.
- Metal melting.
- Moulding and casting.
- Metal cooling, where water-based cooling is used.
- Finishing: knock-out, fettling, machining.
- Sand recovery and recycling after finishing.
Category C: low risk
No advance disclosure is needed for Category C.
- Raw material preparation.
- Metal recycling after finishing: collecting, sorting, cleaning and storing risers, gates and machining chips, with no melting.
Thermal sand reclamation
Mechanical reclamation is Category B. Thermal reclamation units qualify only where they are of MSME-appropriate scale, fitted with effective air pollution control, and the due diligence shows site-specific, reversible, fully mitigable impacts. Industrial-scale or centralised thermal reclamation, or any that causes off-site air quality impact, significant cumulative emissions or breaches of statutory norms, is ineligible.
Your furnace colour
CPCB lists both cupola furnaces and induction or arc furnaces as Orange.
What Senseible does here
Senseible's green loan check shows how ready your bills and records are for a green loan, and its finance application tool helps you put them in order. It does not approve loans or speak for SIDBI.
- SIDBI sector checks for textiles, foundries and steel
- What SIDBI monitors after the loan
- Green loan check
Sources: SIDBI, ESIA and ESMP for direct financing, foundry sector (24 July 2026)
Last reviewed 2026-11-04.