This clean energy rise needs climate finance expansion, Pg6

Key Highlights:

• India added 24.5 GW of solar energy capacity in 2024, ranking third globally after China and the United States.
• The UN Secretary-General’s 2025 Climate Report recognizes India as a leading developing country in scaling solar and wind energy.
• India requires an estimated $1.5 trillion to $2.5 trillion by 2030 to meet its climate targets.
• By December 2024, India's cumulative Green, Social, and Sustainability bonds (GSS)+ debt issuance reached $55.9 billion, a 186% increase since 2021.

Detailed Insights:

• India's renewable energy sector employed over a million people in 2023, contributing to 5% of GDP growth, with off-grid solar employing over 80,000 in 2021.
• A 1.5°C-aligned pathway could lead to an average annual GDP growth of 2.8% through 2050, more than double the G-20 average, according to IRENA.
• While the private sector accounted for 84% of total green bond issuance, access for MSMEs and agri-tech innovators needs improvement through concessional finance.
• Blended finance, including credit enhancement instruments and loan guarantees, can improve the risk-return profile of green projects.
• Unlocking domestic institutional capital from entities like EPFO and LIC requires regulatory reforms and clear ESG investment guidelines.
• India's Carbon Credit Trading Scheme could unlock new finance streams if transparent and well-regulated, alongside financing for adaptation and loss and damage.

Key Concepts Involved:

• Climate Finance: Financial resources directed towards climate change mitigation and adaptation projects.
• Green Bonds: Bonds specifically earmarked to raise money for climate and environmental projects.
• Blended Finance: Strategic use of development finance to mobilize private capital for sustainable development.