The Confederation of Indian Industry (CII) has urged the Indian government to establish a dedicated green finance institution (GFI) in the upcoming Union Budget, warning that the country faces a widening climate investment gap that could hinder its long-term decarbonisation goals.
India will need close to $1 trillion in green investment over the next 10–15 years and roughly $10 trillion by 2070 to meet its net-zero commitments, CII said. Current funding flows cover only about a quarter of the requirement.
The proposed GFI would function as an intermediary rather than a traditional state-backed lender and would be capitalised by multilateral development banks, sovereign wealth funds and philanthropic institutions. CII said the entity should be headquartered in GIFT City, India’s financial services hub, to take advantage of its lighter regulatory framework and appeal to international investors.
According to CII, the GFI should provide concessional loans, credit guarantees, equity support and securitisation of small green assets to lower project financing costs in sectors such as renewable energy, clean mobility, green buildings and industrial decarbonisation.
The industry body also recommended a green tech expo fund to help Indian clean-technology firms showcase innovations on global platforms, facilitating partnerships with international investors and buyers.
CII raised concerns about India’s heavy reliance on imported critical minerals—including lithium, cobalt and nickel—which are essential for electric vehicles, defence electronics and renewable energy manufacturing. Without a robust recycling framework, this dependence poses economic and strategic risks, it said.
To reduce vulnerabilities, CII proposed mandatory recycling and urban mining targets for batteries and electronics, tighter certification rules to prevent the export of unprocessed scrap, and fiscal incentives to build domestic refining capacity and strategic stockpiles.
To accelerate recycling at scale, it suggested the development of 15 circular economy parks within three years and 45 within five years, covering key waste streams such as e-waste, plastics, tyres and batteries. A national programme for large multi-material recycling hubs near major cities would help address India’s fragmented waste management and low material recovery rates.
On regulatory processes, CII called for the creation of a unified Environmental and Climate Clearance Authority (ECCA) with fully digital, integrated approvals across central and state agencies. This would include risk-based fast-track clearances for green projects and automatic approvals within set timelines.
The group also recommended a nationwide digitalisation initiative for the built environment, requiring large commercial buildings to comply with energy codes.
“As India moves closer to its goal of becoming a $5 trillion economy, advancing a green economy is no longer a choice but a strategic necessity,” said Chandrajit Banerjee, director general of CII. “This transition is vital not only for meeting climate goals but also for shaping India’s long-term growth, competitiveness and global standing.”
