India plans to increase spending on green projects and schemes by almost 44% in the next fiscal year, utilising proceeds from sovereign bonds. The move reflects the government's commitment to expedite the financing of clean energy initiatives, with the goal of diminishing the country's carbon footprint and contributing to the ambitious target of achieving net-zero emissions by 2070. As per the expenditure plan outlined by the finance ministry for FY25, the government aims to allocate funds amounting to Rs 320.62 billion for green projects and schemes, a notable increase from Rs 223.24 billion in the current fiscal year. The funding requirements have been formulated based on proposals submitted by various ministries. Although the precise amount of green bonds to be issued in the upcoming fiscal will be determined when the government finalizes its borrowing calendar, the official anticipates issuing bonds valued between Rs 250-300 billion in FY25, up from Rs 200 billion in the current year, owing to increased funding needs. The anticipated expenditure on green projects and schemes in the current fiscal is projected to surpass the funds raised through these bonds by Rs 23.24 billion. Initially, the government had set the green funding requirement for FY24 at Rs 237.64 billion. To address concerns about potential misuse of such funds, officials indicated that spending would be kept higher than actual borrowing, emphasising that the funds raised must strictly be used for green projects. While the government's overall annual budgetary spending on green projects spans various sectors, the expenditures are not precisely categorised according to the environmentally friendly nature of the projects. However, since the government began utilizing green bonds for fundraising in FY23, it has been necessary to formally identify specific green projects to be supported by the proceeds. In terms of fund deployment, the expenditure plan for FY25 indicates that almost 47% of the green investments are earmarked for railways, followed by projects in new and renewable energy (42%), housing and urban affairs (10%), environment and climate change (0.5%), and other sectors. Railways, new and renewable energy, and housing and urban affairs have consistently accounted for the majority of the expenditure funded through green bonds in FY23 and FY24. The largest portion of the proposed funding requirement (Rs 120 billion) pertains to the production of energy-efficient electric locomotives, followed by solar energy (Rs 100 billion). Similar to the current fiscal year, the size of the green bond issue for FY25 would be included in the Centre's overall market borrowing plan for the second half of the fiscal year.