Accelerating Green Finance in India: Definitions and Beyond

India requires $2.5 trillion by 2030 to meet its carbon intensity reduction targets but is currently mobilizing less than 25% of that amount. The Climate Policy Initiative (CPI) identifies the lack of a formal definition of 'Green Finance' as a major barrier to investment. CPI proposes creating a definition based on international practices and stakeholder input to enable better tracking of finance flows and the development of green financial products, serving as a first step toward a comprehensive national green finance strategy.

• India faces significant financial gaps in meeting its climate goals, requiring $2.5 trillion from 2016 to 2030 to reduce carbon intensity by 33-35% by 2030 compared to 2005 levels. Currently, the country is mobilizing less than 25% of the investment necessary to reach this target, while 2.5-4.5% of its GDP is at risk annually due to climate change vulnerability.
• The absence of a standardized definition of Green Finance is a primary obstacle for India's financial sector. A formal definition would facilitate the tracking of finance flows to green sectors, enable the creation of green financial products and services, help intermediaries assess climate risks, and improve reporting and disclosure practices.
• CPI recommends that India develop its Green Finance definition by combining stakeholder views, principles for green economic activities, and international practices, using a finance sector taxonomy as a foundation. This would be the initial step in a broader strategy that includes penalties for carbon-intensive investments, climate risk disclosure, and targeted regulations to incentivize green finance.

APA

Climate Policy Initiative (2020). Accelerating Green Finance in India: Definitions and Beyond. https://www.climatepolicyinitiative.org/publication/accelerating-green-finance-in-india-definitions-and-beyond/

Chicago

Climate Policy Initiative. Accelerating Green Finance in India: Definitions and Beyond. 2020. https://www.climatepolicyinitiative.org/publication/accelerating-green-finance-in-india-definitions-and-beyond/.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=Accelerating Green Finance in India: Definitions and Beyond |date=10 July 2020 |url=https://www.climatepolicyinitiative.org/publication/accelerating-green-finance-in-india-definitions-and-beyond/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiative2020accelerating, author = {{Climate Policy Initiative}}, title = {{Accelerating Green Finance in India: Definitions and Beyond}}, institution = {Climate Policy Initiative}, year = {2020}, month = jul, url = {https://www.climatepolicyinitiative.org/publication/accelerating-green-finance-in-india-definitions-and-beyond/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }