Enhancing India’s Readiness to Climate Finance

Enhancing India’s readiness to access and deliver international climate finance
access to / awareness of/ and
use tools to assess climate
change impacts (e.g. GHG
accounting , or climate risk
screening tools)
is limited to CSR
• There is limited understanding of climate change risk tools though a few funds have
started accounting GHG emissions
• The GOI has taken very few steps to sensitize the private sector on their emissions
contributions or on environmental risk.
Financial Function
Tier 1 Indicators Tier 2 Indicators Detailed Analysis Score
1. National economy
What are the key
macroeconomic and financial
characteristics of the
national economy?
1.2 What are the key
macroeconomic indicators in
the country? Has financial and
macroeconomic performance
impacted climate-related
investment?
India has a robust financial market, however current macro-economic indicators are not very
positive and have impacted FDI in the country
• India has a robust financial sector, and its capital markets have outperformed most
developing countries over the last year.
• Macro indicators including reduced economic growth, high fiscal deficit, high inflation,
and fluctuating conversion rate have impacted international capital inflow in the country
over the past 12-18 months
• For the climate sector, large-scale infrastructure financing has been hindered by the
difficulties in securing long-terms bonds.
• In addition, financial instruments such as foreign currency advances and international
guarantees require RBI approval, which has led to delays and restrictions on investment.
2. Investment in low carbon
& climate resilient initiatives
Is there a strong investment
climate for low carbon and
climate resilient initiatives –
for both the public and
private sectors?
2.1 How established are low
carbon options at present? Is
there significant domestic or
international investment in
renewable energy, energy
efficiency, and other low
carbon technologies?
There has been increased investments in renewable energy (mainly wind and solar) in India, 1.5
but there is a need for further investment in other forms of RE, energy efficiency and
sustainable transport
• Share of RE in the country’s total energy mix has risen from 8% in 2008 to 12% in 2013.
India has about 28 GW of installed RE capacity as of 31 March 2013.
• India has large potential for low carbon options especially in the form of RE and EE
options. India's total RE potential is estimated to be more than 3000 GW. Even in EE,
estimated EE saving potential as per some estimate is in the range of 124 to 255 billion
kWh. 72
72 http://www.pace-d.com/wp-content/uploads/2013/08/EE-REPORT.pdf
Ref: Ricardo-AEA/R/ED59216/Final Report
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