The Securities and Exchange Board of India (SEBI) has officially permitted public limited companies to issue green bonds under a dedicated regulatory framework, effective from November 2025, in a move to promote sustainable finance and support India’s climate goals. This decision aligns with the government’s broader environmental strategy and provides Indian corporates with a structured pathway to raise funds specifically for environmentally sustainable and climate-resilient projects. These include investments in renewable energy, clean transportation, energy efficiency, biodiversity conservation, and pollution prevention technologies.

Under the revised framework, SEBI has introduced a new chapter in the SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021, detailing the eligibility, disclosure, and reporting norms for green bonds. Public companies seeking to issue green bonds must clearly outline the use of proceeds, identify the environmental impact, and appoint an independent third-party verifier to confirm the “green” credentials of the projects being financed. Issuers are also required to submit annual impact and allocation reports to investors and stock exchanges, ensuring accountability and transparency in the deployment of funds.

To enhance investor trust, SEBI has mandated that all green bond issuances be listed on recognized stock exchanges, and companies must comply with additional ESG disclosure norms under the Business Responsibility and Sustainability Reporting (BRSR) Core framework. The regulator has also encouraged credit rating agencies to develop green bond-specific rating models, reflecting environmental impact alongside financial viability. This move is expected to mobilize large-scale climate finance from domestic and international investors and position India as a growing hub for sustainable capital markets. Public limited companies are now being urged to incorporate ESG strategies into their financing plans to take advantage of this green capital window.