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BFSI Chronicle, 11 Edition September2022
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retail investors, which was unveiled recently, may Conference of Parties (COP-26) in Glasgow last year,
allow retail investors to conveniently buy these said that it will achieve net-zero emissions by 2070.
green bonds, as per a report by Moneycontrol.com.
However, in terms of portfolio management, green Simply put, green bonds are debt instruments that
bonds are not for all investors. “Green bonds should are used to raise money to fund projects that have
be subscribed by individuals or institutions that a positive impact on the environment and climate
have a long-term investment horizon and a specific among other things. They are at times referred to as
investment mandate to invest in ESG-related financial climate bonds as well in a generic manner.
instruments,” says Deepesh Raghaw, founder,
Personal Finance Plan, a Sebi-Registered Investment Green bonds have been fast gaining popularity with
Advisor. Climate Bonds Market Intelligence pegging the green
bond market size at an all-time high of $517.4 billion
Green bonds are part of the broader ESG investing in 2021. It further said that it was a 50 per cent jump
concept, but they are not the only medium for ESG when compared to the market size in 2020.
investing. There are several mutual funds and other
alternative green funds available to investors for The growing popularity can be further corroborated
ESG investing. by the fact that the green bond market size was
$104 billion in 2015, as per Climate Bonds Market
What Is The Government Initiative So Far? Intelligence.
In 2017, the Securities and Exchange Board of India
(SEBI) acknowledged the need for green bonds and Interestingly, India was at a distant 17th position
issued a circular prescribing disclosure requirement among green bond issuing nations in 2021 with USA,
for issuance and listing of ‘green debt securities.’ Germany, China, France and UK occupying the top
five slots. In 2021, India issued green bonds worth
The move is seen as a major boost especially with $16.5 billion, as per the study.
the country making aggressive strides towards a
low-carbon economy with ambitious targets like Industry participants, meanwhile, have welcomed
achieving a robust 175 gigawatt of renewable energy the government announcement, which, they believe,
capacity by 2022. will help India transition towards a carbon neutral
economy.
Industry welcomes this step by Government
Industry players have welcomed the government’s Prashant Ruia of Essar Group tweeted: “A blue
decision to focus on green bonds as part of its overall print budget with a nice touch of green! A bold one
borrowing programme and using the proceeds in with a massive hike in public investment will be the
public sector projects. booster dose to restart corporate investments. The
infrastructure allocation with a focus on technology
“As a part of the government’s overall market will generate employment & help transform
borrowings in 2022-23, sovereign Green Bonds tomorrow!”
will be issued for mobilising resources for green
infrastructure. The proceeds will be deployed in He followed it up with another tweet: “Kudos to FM
public sector projects which help in reducing the @nsitharaman ji for outlining plans to Transition to
carbon intensity of the economy,” said finance Carbon Neutral Economy & linking it to provide extra
minister Nirmala Sitharaman while presenting the income to farmers & job opportunities to locals. At @
Union Budget 2022-23. Essar, we are committed to being net carbon neutral
in next 3-5 yrs.”
This assumes significance as India, at the 26th

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