Private financing integral to India’s sustained growth

India is on the ascendant, a fast-growing nation firmly on course to emerge as a global powerhouse. At the same time, India is also an outperformer in achieving sustainability targets and contributing to global climate goals. Our experience underscores that suitable financing options play a vital role in enabling technological transition.

India’s dynamic leadership has outlined a clear roadmap to a Viksit Bharat by 2047, and self-reliance is at the core of this journey. Recognising infrastructure, mobility and manufacturing as the key growth engines for India’s economic transformation, the government has created the momentum for consistent and continuous growth.

Having taken giant strides in the generation of clean energy, the focus is now on cutting emissions and attaining net-zero goals for a sustainable future.

With India as a prime mover in the global effort to achieve climate neutrality, industry–and enterprises–have a key role to play. Bringing core strengths of investment and technology to the fore, the private sector can concentrate on what is essential, i. e. enabling all stakeholders to fulfil their potential in supporting to achieve a sustainable Viksit Bharat.

However, be it transforming cities, mobility networks or industries, the challenge lies in accessing resources required to build smart, sustainable infrastructure. Accelerating any technological transition requires private investment, preferably in the form of a diverse range of financing models to execute and implement innovative technologies.

In times of limited public funding or commercial budget constraints, policymakers and business owners need to explore new avenues of financing that can help manage risks, reduce initial costs, and make complicated projects feasible, such as a range of debt, equity and blended financial instruments that can be structured by private players to make catalytic investments for sustainable development.

Innovative financing solutions are already catalysing transformative sustainability impact in India. A few examples come to my mind, such as financing the sustainability and decarbonisation programme of one of India’s largest tire manufacturer, which has slashed the company’s energy consumption by 40%. Another one is the Pay as you Save financing to one of India’s leading dairy companies, which has led to a saving of one million kilowatt hours and a reduction of 700 metric tonnes of CO2 equivalent annually.

Siemens Financial Services has also supported the financing of a number of transmission lines that are used to secure resilient grid infrastructure, and we have financed clean energy generation projects of India’s leading renewable power developers. One such example is the country’s first round-the-clock renewable energy project, featuring a combination of wind, solar and battery storage technologies located at three different states across India.

Financing future-ready projects leads to multiple benefits. For instance, investing in a company which constructs state-of-the-art automated warehouses and related infrastructure for grain storage helps to support food security by minimising waste as well as maintaining quality of the grains. Contributing to projects in India’s transportation sector under the Public-Private Partnership model is an example of green financing that delivers notable impact on the country’s sustainable mobility targets.

The net-zero target necessitates a multi-fold increase in green investments and to enable this, financing barriers need to be reduced. An integrated solution of technology and financing ensures smooth and efficient implementation of modern technology that allows seamless upgrades of private as well as public operations, with sustainability embedded in the new processes.

Reaching net-zero involves reshaping the interplay between financial resources, technological advancement and environmental needs. While there are near-term challenges, strategic green investors can combine long-term capital, cross-sectoral industry knowledge and ecosystem support to act as a critical catalyst in nurturing sustainable development and contributing to collective climate action.

This article is authored by Veronika Bienert, member, Managing Board, Siemens AG and CEO Siemens Financial Services.