Budget 2025 and India’s Sustainable Growth – ESG Trends to Watch

India’s Union Budget 2025 has sent a strong signal: sustainability and ESG (Environmental, Social, and Governance) are now at the heart of the country’s economic strategy. Announced by Finance Minister Nirmala Sitharaman, the budget focuses on green growth, clean technology, and responsible business practices, setting the tone for India’s net-zero journey.

Key Highlights:

Green Energy Push: The budget allocates record funds to renewable energy, with a special focus on solar, wind, and green hydrogen. The government has expanded the Production Linked Incentive (PLI) scheme for solar manufacturing and announced viability gap funding for offshore wind projects.

ESG Reporting: New guidelines will require listed companies to disclose ESG metrics, aligning with global best practices. This is expected to boost transparency and attract more foreign investment in sustainable sectors.

Circular Economy: The budget introduces incentives for recycling, waste-to-energy projects, and sustainable packaging. Startups working on circular economy solutions will have access to dedicated funding pools.

Water and Agriculture: Major investments are earmarked for water conservation, micro-irrigation, and climate-resilient agriculture, helping farmers adapt to changing weather patterns.[1]

Green Finance: The government will issue new green bonds and set up a sovereign green fund to support climate-friendly infrastructure.

Why It Matters:

Experts say these moves will accelerate India’s transition to a low-carbon economy and make ESG a mainstream business priority. “Budget 2025 is a clear roadmap for sustainable growth, with ESG at its core,” said Rajiv Sabharwal, CEO of Tata Capital.

What’s Next:

With mandatory ESG reporting on the horizon and more capital flowing into green sectors, companies are expected to ramp up their sustainability initiatives. As India gears up for its 2070 net-zero target, all eyes will be on how these budget measures translate into real-world impact.

[1] https://energy.economictimes.indiatimes.com/news/renewable/budget-2025-and-indias-sustainable-growth-esg-trends-to-watch-for/117777120?utm_source=top_news&utm_medium=tagListing