India Set to Experience 5x Surge in Green Investments, Projected at Rs 31 Lakh Crore by 2030

India is poised to witness a massive increase in green investments, with projections indicating a five-fold surge to Rs 31 lakh crore between 2025 and 2030, according to a comprehensive report by Crisil.

This growth is a key part of the nation’s broader strategy to meet its ambitious net-zero goals, and it marks a significant milestone in India’s journey toward sustainable development.

Key Sectors Driving Green Investment Growth

Of the Rs 31 lakh crore green investments, a large portion is expected to flow into renewable energy, transport, and automotive sectors. Specifically, renewable energy and storage are projected to receive Rs 19 lakh crore, reflecting the nation’s commitment to clean energy alternatives.

Additionally, the transport and automotive sectors are slated to receive Rs 4.1 lakh crore, while Rs 3.3 lakh crore is expected to support the oil and gas industry’s transition toward greener solutions.

These investments are crucial in achieving India’s long-term sustainability targets, particularly in the context of the nation’s $10 trillion investment requirement to meet the goals laid out in the Paris Agreement’s Updated First Nationally Determined Contribution (NDC).

India’s NDC commitments include reducing carbon intensity by 45% by 2030 from 2005 levels and ensuring that 50% of the country’s total installed power capacity comes from non-fossil fuel-based energy sources.

India’s Window of Opportunity for Green Investments

Amish Mehta, Managing Director and CEO of Crisil, emphasized that India, as the fastest-growing large economy, is in a unique position to balance both its developmental and environmental priorities.

The country’s increasing commitment to green investments presents a significant opportunity for the government and corporates alike to contribute to a sustainable future.

The Rs 31 lakh crore green investment projection is based on the government’s ongoing plans and corporate initiatives, combined with the progress made in renewable energy infrastructure.

India is moving forward with strategic policies that will drive this transformative change, with a clear focus on achieving long-term environmental sustainability.

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India’s Growing Renewable Energy Capacity

India’s renewable energy capacity has been experiencing robust growth, particularly in solar and wind power. As of December 2024, the country’s renewable energy installed capacity reached 209.44 GW, marking an impressive 15.84% growth from 2023.

The addition of 28.64 GW in 2024 alone represents a 119.46% increase compared to the 13.05 GW added in the previous year. This surge highlights India’s accelerating progress toward its renewable energy targets and the increasing availability of clean energy solutions.

Financing Green Projects: Opportunities and Challenges

The green investment landscape presents different challenges depending on the technology involved. For established, lower-risk technologies such as solar power, wind power, and electric two-wheelers, sufficient debt financing is available through banks, development finance institutions, and bond markets.

These well-established technologies benefit from a relatively lower risk profile, making them attractive to investors.

However, the financing of high-risk green technologies, including green hydrogen, carbon capture, utilization and storage (CCUS), energy storage, and other emerging innovations, requires more significant government involvement.

The report suggests that government grants and incentives will be crucial in improving the viability of such projects and attracting the necessary investment to scale these technologies. As the market for these technologies grows, it is expected that both public and private sector involvement will increase.

The Role of Government Grants and Incentives in Green Technology Development

For high-risk green technologies, government support is vital to making projects more financially feasible. Green hydrogen, for instance, is still in the early stages of development and faces significant cost barriers. Similarly, carbon capture and utilization technologies require substantial investment to reach commercial viability.

To accelerate the adoption of these technologies, it is essential for governments to implement supportive policies, subsidies, and grants that can de-risk the investment environment for these emerging solutions.

As India looks toward achieving its net-zero commitments by 2070, the role of government policy, financial incentives, and international partnerships will be central in enabling the growth of the green investment ecosystem.

By providing early-stage financial support, India can attract the investment necessary to develop and scale cutting-edge green technologies that will power the country’s clean energy future.