Green finance: Can India grab the opportunity?
India's green finance landscape has three notable characteristics. First, the cost of green capital is higher due to its unconventional nature, the risks involved and the absence of a conducive regulatory framework. Second, there is a lack of sound and verifiable green financial products in the market. The existing ones are skewed in favour of debt instruments which only partially cover the risk and scale of long-term finance. Last, there is a predominance of projects for renewable energy capacity addition, with small allocations for energy efficiency. Difficult sectors like infrastructure, industry, resource efficiency, and transport have few projects.