India's Environment-Tech Funding Surges in Carbon Capture, Solar Tech

India’s Environment-Tech Funding Surges in Carbon Capture, Solar Tech

Funding Surges in Carbon Capture

India’s environmental technology sector is not just witnessing a remarkable surge in funding, but also playing a pivotal role in the global fight against climate change. According to a recent report by Tracxn, a market intelligence platform, investment in the sector has significantly increased over the past five years. This surge, released in conjunction with World Environment Day, underscores key trends and emerging sectors that are not only contributing to India’s environmental sustainability but also shaping the global landscape.

Significant Increase in Funding

The report reveals a dramatic rise in environmental tech funding in India, climbing from USD 225 million in 2018 to USD 1.5 billion in 2023. This growth represents a compounded annual growth rate of 140 percent, demonstrating strong investor confidence in the sector. 

“India’s environmental tech funding surged from USD 225 million in 2018 to USD 1.5 billion in 2023, reflecting a compounded annual growth rate of 140 percent,” the report states.

Key Sectors Attracting Investment

Among the various areas of environmental technology, carbon capture technologies and solar energy technology have seen significant investment. Over the past five years, carbon capture technologies attracted more than USD 42 million, while solar energy technology garnered over USD 161 million.

India is also witnessing a substantial rise in startups focusing on hydrogen production and storage, electric vehicles, and drought resilience through wastewater management. Startups addressing drought resilience have received over USD 35 million in funding, significantly exceeding the annual investments of previous years.

Global Context and Regional Trends

The report provides an interesting insight into the global funding patterns in the environmental tech sector. While both Europe and India have seen an increase in funding, the United States’ contribution has declined from 60 percent in 2018 to 40 percent in 2023. This shift in global funding patterns indicates a more balanced distribution of investment in environmental technologies, with India emerging as a significant player.

Emerging Startups and Innovation

India’s environment-tech landscape is evolving rapidly, and startups are leading this transformation. The current count of unicorns and unicorns in the sector stands at one and 26, respectively. These startups are not only at the forefront of innovation but also developing sustainable solutions that address critical environmental challenges, inspiring a new wave of environmental technology professionals and researchers.

Geo-Green Scorecards

The report highlights substantial funding for geo-green scorecards in India, amounting to USD 6.55 billion. In 2024 alone, USD 372 million has been received, emphasizing the growing importance of environmental impact assessments and sustainability metrics in investment decisions.

“The landscape of environmental tech startups is evolving, with shifts in funding and innovation patterns across regions and sectors. As the world grapples with climate change, the role of startups in developing sustainable solutions is more critical than ever,” the report concludes.

India’s surge in environmental tech funding is not just a local phenomenon, but a reflection of a broader global trend towards sustainability and innovation. With sustained investment and support, India’s environmental tech sector is poised to become a key player in the global fight against climate change, making significant contributions to environmental sustainability.

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