Green Finance

Abstract

Concept of green finance can be regarded as innovative in the field of Finance. The term describes a broad range of funding for environment-oriented technologies, projects, industries or businesses. The principal objective of this paper is to study what green finance is all about and would verify if this concept is feasible in India for balancing the ecological depreciation due to adjustment of carbon gases in atmosphere. Green finance is a core part of low carbon green growth because it connects the financial industry, environmental improvement and economic growth and all these are essential for country like India to sustain in the long run. Along with this green growth is an economic growth paradigm that simultaneously pursues growth and improvement of environment by driving growth and job creation through R&D in clean energy and green technology, conserving and efficiently using energy and resources and mitigating climate change and environmental degradation. Green Finance is market based investing or lending program that factors environmental impact into risk assessment, or utilizes environmental incentives to drive business decisions. In general, three broad, related drivers and trends are behind the emergence and growth in “green” product and service demand, they are, environmental knowledge and media coverage; environmental awareness and public opinion; and environmental regulation and legislation which needs to be duly taken care off. Through this paper , the authors have triad to explain the concept with detailed exposure to Indian framework. In India, SIDBI has taken various initiatives to promote lending for green and efficient technologies in MSME sector.