State Bank of India Managing Director Ashwini Kumar Tewari highlighted the significant opportunities that climate finance holds for the banking sector at the CNBC-TV18 PWC Banking Dialogues on Thursday, June 8. Tewari urged banks to give utmost importance to sustainability and climate risks, aspects that have been largely neglected within the Indian banking industry until now.

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Looking ahead, Tewari outlined significant opportunities in the field of climate finance. With India's ambitious targets set for 2017 and 2030, the interim opportunity till 2030 alone amounts to approximately Rs 30 lakh crore.

"Going forward, there are big opportunities. One opportunity is climate finance itself. Now with the targets which India has taken till 2017 and 2030, the interim targets, the opportunity till 2030 itself is around (Rs) 30 lakh crore," he said.

Comparatively, the domestic loan book of State Bank of India currently stands at around Rs 28 lakh crore.

During the meeting, which brought together both public and private sector representatives, he specifically highlighted sustainability and climate risk as crucial focal points, alongside other separate topics such as environmental, social, and governance (ESG) considerations.

Tewari emphasised that if the entire opportunity is captured, the bank's loan book could potentially double. However, he acknowledged that achieving this goal would require collaborative efforts from multiple banks.

"…We can double that loan book if we capture the entire opportunity."

Tewari identified a diverse range of sectors that contribute to climate finance, including electric vehicles (EVs), battery technologies, renewable energy, battery manufacturing, hydroelectric power, and more.

"Of course, we alone won't do it. So that's one big piece which we have to look at, and it consists of myriad of things … like things from EVs, the battery, the switching, the swapping technologies. Renewable, of course continues to be a strong play. Then going forward to the battery manufacturing, the pump, hydro, all kinds of things."

He emphasised the need for banks to swiftly leverage these opportunities, as they align with national contributions and commitments aimed at addressing climate change and safeguarding the planet.

"So I think that's one very, very big opportunity which all banks have in which we should start to leverage very quickly because this is part of our national contributions and national commitments and we actually need to do it for the planet itself. "

(Edited by : Shoma Bhattacharjee)

First Published:Jun 8, 2023 7:06 PM IST