Indian currency, the Rupee, ascends to its highest position in 7 months; however, ends the session with a weaker tone due to the Reserve Bank of India's dollar purchase.
Mumbai: The Indian Rupee hit a seven-month high of 83.75 against the U.S. dollar on Friday. However, the Reserve Bank of India (RBI) intervened, purchasing dollars through public sector banks, and certain defense payments resulted in the currency closing the day at 84.51, slightly lower than its Thursday close.
New Delhi: India announced plans for a green finance body to support its goal of achieving net-zero emissions by 2070. The country is taking several steps to create a sustainable financial framework to channel investments towards environmentally friendly activities.
Green Finance Framework
India has unveiled a draft Climate Finance Taxonomy to facilitate investments in sustainable activities and align with its net-zero ambitions. The consultation period for this draft ends on June 25, 2025. This initiative will ensure that capital is directed towards activities meeting stringent sustainability requirements, enhancing transparency and preventing possible greenwashing.
The country is also making efforts to increase its non-fossil fuel capacity to 500 GW by 2030, with renewable energy sources expected to account for half of its electricity mix. As of May 2024, India has installed approximately 191 GW of renewable energy capacity, comprising solar, wind, hydro, and biomass.
Regulatory measures are also being implemented to support the transition. For example, new Green Energy Open Access (GEOA) regulations have been introduced to facilitate the integration of green energy.
Challenges and Opportunities
Transitioning to clean energy is crucial for energy security and job creation. The Indian government aims to create 3.5 million jobs in the renewable sector by 2030. However, success depends on integrating the Climate Finance Taxonomy into financial regulations by bodies such as the RBI and SEBI and providing incentives for small and medium enterprises (MSMEs) to adopt green practices.
In summary, India is actively working towards building a green finance framework to support its net-zero goals, with ongoing efforts in policy development, regulatory alignment, and investment mobilization. The country is taking significant steps to channel investments towards sustainable activities and implement measures for a cleaner and more secure energy future.
The Reserve Bank of India (RBI) could consider incorporating environmental-science principles into its financial regulations, aligning with India's green finance body and Climate Finance Taxonomy, to further support the sustainable economy and industry. Given India's target to increase its non-fossil fuel capacity to 500 GW by 2030, finance institutions may find this new sector financially attractive, potentially opening up opportunities for investment in science and technology related to renewable energy.
