Green Finance: A Key to Fight with Climate Change

Abstract

Climate change (CC) is a burning issue in the contemporary situation. All nations should be concerned about this, and it must be addressed right away. Additionally, greater funding is required to discourse this issue. Green finance becomes a global issue in sustainable economic and financial growth. Green finance refers to the financial arrangements that are specifically used to fund ecologically viable plans or projects that incorporate the features of climate change. Member nations of the Kyoto Protocol, which was endorsed on December 11, 1997, gave it a top priority. These initiatives fall under the categories of “green financing,” “waste processing and recycling,” “biodiversity protection,” “climate change adaptation,” etc. In addition to helping India and poor nations to achieve the Sustainable Development Goals (SDGs), green financing may help them raise money to fulfill their Nationally Determined Contribution (NDC) obligations under the Paris Agreement. Greening the industry through finance will lead to eco-sound results, ultimately leading to the green growth of the nations. Different countries can adopt green financing in a variety of methods and with varying legislation. In India, CSR was deemed necessary for NBFCs and SCBs by 2007. NAPCC was established in 2008 to adopt and mitigate the climate change policy. In the Union Budget of 2022, Finance Minister has announced the issuance of sovereign green bonds during the upcoming fiscal year. SGBs could potentially mobilize additional financial resources to support India’s commitment to achieving net-zero carbon emissions by 2070. The issuance of sovereign green bonds is a baby step toward directing private capital flows toward environmentally beneficial public projects. Other government programs aimed at preventing climate change and developing a low-carbon economy may receive funding from green financing.