Niti Aayog proposes a National Green Financing Institution to fund India's net-zero goal, focusing on low-cost green capital
New Delhi: The government’s think-tank, Niti Aayog, said that the Centre is planning to set up a National Green Financing Institution to support its net-zero target by 2070, as current finance flows for climate initiatives remain much lower than the desired levels. “The move of the government aims to aggregate green capital from different sources and lower the cost of capital,” the Aayog said in its annual report for 2024-25.
As part of its climate commitments or Nationally Determined Contributions (NDCs) submitted to the United Nations Framework Convention on Climate Change (UNFCCC) in 2022, India aims to reduce its GDP emission intensity by 45 per cent by 2030 compared to 2005 levels. It also aims to achieve 50 per cent of its installed electric power capacity from non-fossil fuel sources by 2030.
“The Aayog is examining structuring mechanisms for operationalising a potential National Green Financing Institution, including a bank modelled on NaBFID/NABARD, repurposing existing institutions like IREDA; Climate Fund in GIFT city, Green InvIT, etc. (non-exhaustive) along with analysing best practices from Green Banks around the world,” the report said.
As carbon emission is a prime concern for the climate changes across the world, India has also pledged to create an additional carbon sink of 2.5 to 3 billion tonnes through additional forest and tree cover by 2030.
