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India's annual green finance needs are not being met: report

A recent report by the Climate Policy Initiative shows that India doesn't have enough green investments to meet its climate targets

Finance is key to tackling climate change.
Finance is key to tackling climate change. (Photo by Markus Spiske, Unsplash)

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An analysis and advisory organisation has released an update on India's "first-ever effort" to track green investment flows, which are falling far short of the country’s current need for its ambitious climate targets.

Climate Policy Initiative in its report titled 'Landscape of Green Finance in India', has claimed that "the tracked green finance in 2019-2020 was 309,000 crore (nearly USD 44 billion) per annum, which is less than a fourth of India's needs".

The report estimates that for India to achieve its Nationally Determined Contributions (NDCs) under the Paris agreement, the country requires approximately 162.5 lakh crore (USD 2.5 trillion) from 2015 to 2030 or roughly 11 lakh crore (USD 170 billion) per year, the US-based organisation said in a statement.

Also read: Why Indian states and cities need climate action

The evaluation of finance flows has been estimated for key real economy sectors like clean energy, clean transport and energy efficiency, the organisation said.

The study tracks both public and private sources of capital -- domestic as well as international -- and builds a framework to track the flow of finance right from the source to the end beneficiaries through different instruments with an emphasis on bottom up approaches based on actual flows rather than commitments, providing the most accurate analysis to date of where India’s climate finance stands, the finance gaps it faces, and the opportunities that lie ahead, the statement said.

This year, the report also provides a first-of-its-kind evaluation of adaptation financing for select sectors.

"The report shows increased flows to renewable energy sectors. This indicates the positive role policy support has had on the renewable sector. We would also in the future hope to see a similar role being played in other sub-sectors like distributed renewable energy - rooftop solar and clean mobility," said Neha Khanna, project manager and lead author, Climate Policy Initiative-India. 

Also Read: Could green hydrogen be a game-changer for clean energy?

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