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$1 Trillion Investment towards ESG in Indian Market
Updated: Oct 7, 2022
India has a high potential for development in sustainable investment, with the capacity to deliver $1 trillion, by 2030 toward major ESG goals, including financing the climate transition. According to Standard Chartered's Sustainable Banking Report 2022: Mobilising Retail Investor Capital, this capital might also play a crucial role in bridging financing shortfalls such as waste management and pollution control. By 2030, $8.2 trillion in investable retail money may well be channeled into sustainable investments to achieve ESG goals.
Across India, 46% of investors want to assist in achieving environmental sustainability, while nearly 40% want to use their money to hedge against ESG risks, and 33% want to have a positive social contribution. However, with a more effectively regulated ESG market and an expanding pool of institutional investors, India's $1 trillion in potential retail wealth may be focused on tackling ESG challenges.
Climate-relevant solutions
The research emphasizes the importance of making climate-themed investment options more broadly available in order to transform investor enthusiasm into measurable impact.
Accessibility (51%), comparability (49%), and comprehensibility (44%), according to Indian investors, are the main impediments to growing their sustainability-focused investments. The findings show how financial institutions may play a significant role in unleashing capital by collapsing these obstacles for investors.
The report emphasizes the importance of enabling access to sustainable investments by making solutions available through digital platforms. They should be able to offer clear and transparent information, tackle investor concerns, and provide data-driven advice on how to suit their ESG objectives with the required support.
ESG-related concerns
"The top ESG-related issues across the 10 markets we surveyed – climate change, pollution, poverty, corruption, food scarcity and energy security – correspond to the areas that investors are most interested in addressing," said Marc Van de Walle, Global Head, Wealth Management.
According to Saurabh Jain, Head of Wealth Management at Standard Chartered Bank, India is well on its way to promoting transparency and regulating the ESG rating process to encourage larger private capital involvement in the ESG market, a positive sign. He also said that when combined with government and corporate spending, India has one of the greatest investment opportunities and individual retail interests. This will play a significant role in promoting sustainable development and combating climate change.