Green Finance and Banking Transformation: Driving Sustainable Growth in India

This study examined the role of green finance in promoting sustainable development in India and analysed the contribution of the banking sector towards sustainable finance and green growth. The study was done based on the secondary data collection obtained from the annual reports of RBI, SEBI publications, Climate Bonds Initiative reports, and published research which revealed that green finance has turned out to be an integral part of the financial system of India. Financial institutions are increasingly embracing environmentally friendly development through the growth of green bonds, sustainable lending, financing based on ESG principles and digital banking. The results indicate the important role of banks in financing renewable energy projects, promoting sustainable investment and practicing green banking. Meanwhile, the RBI and the Securities and Exchange Board of India (SEBI) have been supporting the growth of green finance in the country. The study also highlights a number of obstacles, such as the absence of harmonised ESG reporting requirements, greenwashing concerns, the scarcity of climate related data, cost of financing green projects and the disparity in the implementation of sustainable practices among financial institutions. The study finds that Green Finance has tremendous potential in the long-run in supporting India's economic growth in the context of environmental protection. To realize this potential, more policy support, more effective regulation, more transparency, and increased involvement from banks, businesses and investors are needed. With a coordinated environment amongst all stakeholders, the green finance ecosystem can be further strengthened and a more sustainable, resilient and inclusive financial system built in India.

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