India emerges as a major hub for climate capital as clean tech investments surge

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India is becoming a leading destination for climate-focused investments, driven by rising demand for clean energy and zero-emission technologies across critical industries, according to Bloomberg New Energy Finance (BNEF.

The country saw investment over $2 billion in climate capital over the past year, marking a significant rise in investor interest and long-term commitment to sustainable solutions.

In the past 8–12 months, global climate investors, including TPG Rise Climate, Breakthrough Energy Ventures, LeapFrog Investments, Lowercarbon Capital, and Fullerton Fund Management, have moved beyond pilot initiatives to make sizeable, strategic investments in India’s clean energy ecosystem.

This growing inflow of funds is propelled by more than just environmental concern. A combination of cost parity with traditional fuels, rising consumer and industrial demand, and a supportive policy environment is making India an attractive market.

“There’s been a marked uptick in growth and infrastructure capital doubling down on platform plays across circularity, e-mobility, OEMs, battery lifecycle management and energy storage,” said Nakul Zaveri, partner and co-head of Climate Investment Strategy at LeapFrog.

Clean energy is increasingly being used in essential services such as logistics, cooling, and distributed power, rather than for discretionary purposes, giving investors confidence in the sector’s scalability and profitability.

A prime example is the $60 million investment from the European Investment Bank (EIB), supported by the International Finance Corporation (IFC) and Temasek. Meanwhile, Fullerton Fund Management recently invested in AI-powered transport firm Routematic through its Fullerton Carbon Action Fund.

Global climate finance reached over $2 trillion in 2024, with a substantial share directed toward electric vehicles, battery storage, and green infrastructure. In India, this funding trend is increasingly shifting toward companies with robust revenue models and proprietary technologies.

Industry experts expect India’s climate finance landscape to deepen over the next two to three years, with investments focusing on technologies capable of transforming high-emission sectors.