Key Details
India set out its position during the ministerial dialogue on Innovative Financial Mechanisms for Healthy Land and Drought Resilience at UNCCD COP17 in Ulaanbaatar.
International finance: India called for funding that is diversified, adequate, predictable and sustained, rather than dependent on intermittent project-based flows.
Domestic framework: Its blended green-finance architecture supports climate adaptation, sustainable land use, forestry, agriculture, afforestation and biodiversity conservation.
Financing channels: The Government highlighted Sovereign Green Bonds, the Green Credit Programme and compensatory afforestation funds, alongside private and corporate participation.
Implementation principle: Finance should be continuous, verifiable and connected to local communities, with success measured through lasting restoration and resilience rather than money mobilised alone.
India Presented a Diversified Financing Architecture
India’s blended green-finance framework seeks to combine public, private and market-based resources rather than place the full cost of land restoration on government budgets.
The Union Environment Minister identified Sovereign Green Bonds as one source of capital for land restoration, drought resilience, sustainable forestry and other environmental priorities.
Other channels include compensatory afforestation funds, corporate finance, CSR resources and the Green Credit Programme. Together, these mechanisms are intended to mobilise finance while retaining public oversight and linking expenditure to restoration outcomes.
What Is Blended Green Finance? It combines public resources with private or market-based capital to finance environmental objectives, allowing different sources of funding to support the same broader programme or landscape.
Green Credits Are Tied to Restoration Outcomes
Under the Green Credit Programme, public and private entities can finance restoration on degraded forest land. Credits are issued only after:
five years of restoration activity; and
achievement of at least 40% canopy density.
A credit may then be used once towards compensatory afforestation, statutory plantation or CSR obligations.
The five-year requirement distinguishes the mechanism from one based simply on financing or planting trees: a defined restoration threshold must first be achieved.
Different Funding Streams Could Converge on the Same Landscape
India proposes bringing Green Credits, compensatory afforestation resources, private finance and citizen participation together rather than operating them as separate programmes.
This could allow restoration to address connected needs involving vegetation, water, biodiversity, agriculture and livelihoods, with public institutions, companies and communities contributing through different mechanisms.
The approach also makes coordination important. Combining funding streams will require clarity over responsibilities, safeguards and how restoration outcomes are attributed across different sources of finance.
Domestic Finance Cannot Substitute for International Support
India argued that stronger domestic mobilisation cannot replace additional, adequate and predictable international finance for desertification, land degradation and drought.
The distinction is important: blended finance is presented as a way to expand the domestic financing base, not shift the entire burden of restoration from international commitments onto national governments or private actors.
India also offered to share its institutional arrangements, safeguards, implementation experience and lessons—including areas requiring course correction with other countries.
Policy Relevance
Align finance at the landscape level: Restoration funds should follow common ecological plans so that public schemes, compensatory payments and private projects reinforce rather than duplicate one another.
Strengthen additionality: Green credits should reward restoration that would not have occurred under an existing legal or financial obligation.
Connect communities with financial decisions: Local institutions and land users need a role in project selection, implementation and benefit-sharing, particularly where restoration affects access to land or forest resources.
Publish comparable outcomes: Reporting should cover ecological recovery and community effects alongside funds mobilised, hectares treated and credits issued.
Define the international ask: India’s call for predictable finance will carry greater weight if linked to clearly costed restoration priorities, implementation pipelines and transparent monitoring systems.
Relevant Question for Policy Stakeholders: Can India demonstrate that its blended-finance mechanisms restore functioning ecosystems and strengthen local livelihoods, rather than primarily mobilising money and plantation credits?
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