{"id":345534,"date":"2025-09-01T17:01:59","date_gmt":"2025-09-01T11:31:59","guid":{"rendered":"https:\/\/forumias.com\/blog\/?p=345534"},"modified":"2025-09-01T17:01:59","modified_gmt":"2025-09-01T11:31:59","slug":"green-bonds-3","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/green-bonds-3\/","title":{"rendered":"Green bonds"},"content":{"rendered":"<p><strong>NEWS<\/strong><strong>: <\/strong>Global issuance of green bonds has crossed $3 trillion and reached $577 billion in 2024, yet they account for only 3 per cent of the bond market.<\/p>\n<h2>About Green bonds<\/h2>\n<figure id=\"attachment_345536\" aria-describedby=\"caption-attachment-345536\" style=\"width: 353px\" class=\"wp-caption aligncenter\"><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\" wp-image-345536\" src=\"https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2025\/09\/Source-LiveMint.jpg?resize=353%2C199&#038;ssl=1\" alt=\"\" width=\"353\" height=\"199\" srcset=\"https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2025\/09\/Source-LiveMint.jpg?resize=300%2C169&amp;ssl=1 300w, https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2025\/09\/Source-LiveMint.jpg?resize=768%2C432&amp;ssl=1 768w, https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2025\/09\/Source-LiveMint.jpg?w=893&amp;ssl=1 893w\" sizes=\"auto, (max-width: 353px) 100vw, 353px\" \/><figcaption id=\"caption-attachment-345536\" class=\"wp-caption-text\">Source &#8211; LiveMint<\/figcaption><\/figure>\n<ul>\n<li>Green bonds are <strong>debt instruments<\/strong> issued by governments (Sovereign Green Bonds issued by RBI), corporations, and multilateral banks to <strong>raise funds for projects<\/strong> that <strong>reduce emissions<\/strong> or enhance climate resilience.<\/li>\n<li><strong>Interest payments:<\/strong> Like other <strong>bonds<\/strong>, these bonds provide <strong>investors fixed interest payments<\/strong>.\n<ul>\n<li>Investors in green bonds are usually <strong>long-term<\/strong>, impact-focused investors looking for <strong>stable returns<\/strong> and <strong>compliance<\/strong> with green financing mandates.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Less tax:<\/strong> <strong>Generally<\/strong>, governments provide <strong>tax incentives like tax credits<\/strong> to make them <strong>attractive<\/strong> for investors.<\/li>\n<li><strong>Regulators<\/strong>\n<ul>\n<li><strong>Securities and Exchange Board of India (SEBI) <\/strong>for corporate green bonds and<\/li>\n<li>The <strong>Ministry of Finance (Department of Economic Affairs)<\/strong> (which oversees the Green Finance Working Committee) for sovereign green bonds.<\/li>\n<\/ul>\n<\/li>\n<li>The <strong>World Bank<\/strong> issued the first official green bond in <strong>2009<\/strong>.<\/li>\n<li><strong>Status:<\/strong> India\u2019s <strong>corporate bond market<\/strong> is about <strong>17 per cent of GDP<\/strong> and its <strong>green bond segment is about 4 percent.<\/strong><\/li>\n<li><strong>Different from other types of bonds<\/strong>\n<ul>\n<li><strong>Yield: <\/strong>These bonds typically offer <strong>lower yields (interest rates)<\/strong> than conventional bonds, allowing issuers to raise funds at a lower cost (<strong>greenium<\/strong>).\n<ul>\n<li><strong>The greenium, or green premium<\/strong>, is the yield difference that creates a cost advantage for issuers, and a <strong>higher greenium makes green investments more attractive.<\/strong><\/li>\n<\/ul>\n<\/li>\n<li><strong>Commitment:<\/strong> The <strong>proceeds<\/strong> from Green Bonds are <strong>exclusively earmarked for green and environmentally sustainable projects<\/strong>.\n<ul>\n<li>For regular bonds, the issuer can use the proceeds for various purposes at her discretion.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<li><strong>Green bonds market feature<\/strong>\n<ul>\n<li>Issuers <strong>often offer lower yields<\/strong> than conventional bonds and commit to use proceeds exclusively for green investments.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Issues <\/strong>\n<ul>\n<li>High compliance, certification, and reporting costs disadvantage smaller entities and create an uneven field.<\/li>\n<li>The <strong>absence of global standardisation<\/strong> in green definitions reduces comparability for investors and issuers.<\/li>\n<li><strong>Greenwashing<\/strong> risks erode credibility, and funding of thermal power alongside green fundraising confuses investors.\n<ul>\n<li><strong>Greenwashing<\/strong> refers to the misrepresentation of a bond\u2019s environmental credentials, where the proceeds may not genuinely fund green projects or deliver meaningful benefits, which dents investor trust and market credibility.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>NEWS: Global issuance of green bonds has crossed $3 trillion and reached $577 billion in 2024, yet they account for only 3 per cent of the bond market. About Green bonds Green bonds are debt instruments issued by governments (Sovereign Green Bonds issued by RBI), corporations, and multilateral banks to raise funds for projects that&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/green-bonds-3\/\">Continue reading <span class=\"screen-reader-text\">Green bonds<\/span><\/a><\/p>\n","protected":false},"author":10393,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1566,3127,12039],"tags":[11872],"class_list":["post-345534","post","type-post","status-publish","format-standard","hentry","category-daily-factly-articles","category-economy","category-knolls","tag-9pm-daily-factly","entry"],"jetpack_featured_media_url":"","views":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/345534","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10393"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=345534"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/345534\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=345534"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=345534"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=345534"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}