"Accelerating Ambition and Finance: India's Journey to Net-Zero," was the theme of the Climate Bonds Mumbai Connect 2024, a global market engagement dialogue series organised in partnership with MUFG Now – the flagship ESG series hosted by the bank.
Click here to watch the event on Youtube.
The event brought together over 170 industry players, including rating agencies, companies, investors and bankers. The discussion focused on diversifying the pipelines of net-zero aligned investments and attracting an even larger capital pool on the back of credible and ambitious plans and projects. Investor demand for green products continues to outstrip supply.
A Growing Green Market in India
The keynote address by Anant Narayanan, Whole Time Member at SEBI, highlighted the significant growth in mutual fund investors and depository account holders as a shift from savings to investment. He outlined SEBI's initiatives to boost 'Capital Formation' through green bond markets, address greenwashing, and foster green investments through policies like Business Responsibility Sustainability Reporting (BRSR), BRSR Core, and pioneering the framework for ESG rating providers. Narayanan emphasized the role of green mutual funds in India's sustainable finance ecosystem and called for collaborative dialogue and actionable insights to refine India's green finance trajectory.
The first panel, featuring leading issuers of labelled debt, represented a cross-section of sectors including utility-scale renewable energy, cement and steel, and financing institutions. Notable speakers included Tomohiro Ishikawa from MUFG, Rajat Gupta from Avaada Group, Prabodha Acharya from JSW Group, and Salee Sukumaran Nair from the State Bank of India (SBI). The panel noted the need for innovative mechanisms to support investment in clean technologies, especially in regions like Asia, to effectively reduce emissions. Speakers also emphasised that the journey to net-zero is complex and requires a multifaceted approach to unlocking larger amounts of capital. These approaches range from deepening the domestic bond market to providing viability gap funding, as well as utilising tools such as blended finance and credit enhancements.
The second panel brought together internationally-focused investors focused on Emerging Market and Developing Economies (EMDE), such as Victoria Harling from Ninety One, Shilpa Singhal from Schroders, Abishek Kumar from State Street Global Advisors, and Esther Law from Amundi. Emphasising the importance of transparent reporting and clear transition strategies for attracting investment, they advocated for looking beyond carbon metrics alone to make the shift towards net-zero. This underscored the need for investments that have a measurable impact on decarbonising the economy.
The concept of 'greenium' and its potential to lower capital costs over time through increased credibility was discussed. While there is acknowledgment of the costs associated with requirements such as disclosures, the panelists advocated for a long-term view, suggesting that the credibility and transparency gained through green finance could, over time, lower the overall cost of capital for issuers.
Despite challenges, the optimistic outlook for the future of green finance, particularly in emerging markets like India, was clear. This suggests a promising avenue for combating climate change through strategic investment in renewable energy and green industrial infrastructure.
The event concluded with a fireside chat featuring Robbie Singh, Group CFO of Adani, highlighting the journey of the Group's transition. This was emphasised in terms of the strategic shifts made by focusing on the economic viability of green investments without relying on government subsidies. The discussion underscored the importance of transitioning not just for environmental benefits, but also as a lucrative opportunity for wealth creation and corporate competitiveness.
Click here to see the pictures on Flickr.
Climate Bonds CONNECT 2024
Climate Bonds CONNECT 2024 continues with a series of global events focused on mobilising capital for climate action. The next event will be in Shanghai, where thought leaders and investors will discuss how to promote and develop the sustainable finance market in Asia. Learn more at climatebonds.net/conference.
