About the Report
India’s climate ambitions require more than a framework for identifying sustainable economic activities. They require a financial and regulatory architecture capable of directing capital towards them.
The Department of Economic Affairs’ Draft Framework for India’s Climate Finance Taxonomy, released in May 2025, represents an important step towards establishing a common language for sustainable investment. Yet translating this framework into meaningful capital flows will depend on its integration with existing disclosure requirements, lending mechanisms, regulatory incentives and international sustainable finance standards.
Activating India’s Climate Finance Taxonomy: From Framework to Action examines how India can move from classification to implementation by leveraging existing regulatory and institutional mechanisms.
The report presents five actionable policy recommendations addressing taxonomy-aligned corporate disclosures, priority sector lending, international interoperability, sector-specific technical screening criteria and data infrastructure for Micro, Small and Medium Enterprises (MSMEs).
It further proposes a 2+2 implementation roadmap, combining near-term regulatory and market interventions with longer-term institutional reforms. Drawing on experiences from the European Union, China, ASEAN, South Africa, Singapore and Colombia, the analysis identifies practical lessons for developing a credible, inclusive and internationally interoperable climate finance ecosystem.
This publication marks the first research report from The Dialogue’s Climate Finance & Sustainability vertical, advancing the organisation’s work at the intersection of climate policy, financial regulation and sustainable economic development.
Developed with support from Ashoka University, the report seeks to inform policymakers, financial regulators, industry stakeholders and researchers working to strengthen India’s sustainable finance architecture.
But how can India translate these policy opportunities into tangible financial outcomes? Which interventions can deliver meaningful progress within existing institutional structures, and what will it take to bridge the gap between climate ambition and capital mobilisation?
The answers lie in the report’s proposed policy interventions, comparative insights and implementation roadmap.
Explore the full report to discover how India can move from framework to action.