According to Business Standard, the Reserve Bank of India is working on a framework for standardizing green bond issuances and financing issues. This is an attempt for India to align with other nations that already have these types of rules. The RBI is India’s most important banking institution was founded in 1935 in response to economic issues caused by World War I. Even though it was originally privately owned, the RBI is fully owned by the government of India.
India is at a critical juncture in scaling renewable energy to provide energy access to its growing cities and vast rural communities. Financing remains the principal barrier to the rapid expansion of India’s clean energy market needed to meet their ambitious national targets. The right policy settings and incentive structures must be adopted to enable renewable energy investment to scale up to needed levels. Innovative financial mechanisms and institutions such as green bonds and green banks, respectively can help propel India’s solar and wind energy markets and support critical energy-saving efficiency and climate resilience projects.
These green bonds raise funds for projects with environmental benefits, such as renewable energy, low carbon transport, or climate adaptation. To achieve India’s clean energy and climate goals, new innovative financial instruments that tap into international resources to leverage a wider investor base need to scale up. The three main objectives of this strategy include reducing the cost of capital, stimulate demand from institutional and retail investors, and expand and diversify the issuers base.
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