New Delhi: Tax incentives, easier overseas borrowing norms and innovative financial instruments for clean energy projects will boost India's efforts to achieve sustainable development in the long term, says a report.
The renewable energy sector should be put under Priority Sector Lending (PSL) category and unutilised amount under PSL should be diverted to clean energy, the Ficci UNEP Inquiry Report, prepared at the behest of Power Minister Piyush Goyal, said in its recommendations.
Moreover, there is need to provide incentives in particular sectors such as output-based support or result based financing for the waste management sector.
The report further said that the existing guidelines of National Clean Energy Fund need to be amended in order to sharpen its operational framework and improve its effectiveness and performance.
A separate window should be created to allocate funding for specific types of projects that improve energy access, it noted.
There is need for credit rating and credit enhancement facility within the government or financial institutions that would encourage pension or insurance funds to invest in clean projects, the report pointed out.
The report also advocated developing new thematic markets such as the Green Bonds market and Yield Companies (YieldCos).
The UNEP (United Nations Environment Programme) Inquiry is a global initiative launched at Davos in 2014 with the aim of advancing policy options to scale up capital for sustainable development. It is working across 15 countries and is looking at innovations in banking, capital markets, insurance and investment policies.