India Raises Climate Spending to 5.6% of GDP, Says FM Sitharaman

Finance Minister Nirmala Sitharaman has said India has significantly increased its public spending on climate action to 5.6% of GDP , up from about 3.7% six years ago , underscoring the country’s commitment to meeting its nationally determined contributions (NDCs) and accelerating the transition to a low-carbon economy. Speaking at a panel discussion during the Munich Security Conference , she stressed that India is investing its own resources rather than waiting for external financing or technology support, while continuing to call for global cooperation.

The spending figure does not represent a single climate fund. Instead, it reflects climate-linked public expenditure embedded across multiple sectors, including renewable energy expansion, energy efficiency programmes, clean transport, rail electrification, green hydrogen, and sustainable urban infrastructure. It also covers adaptation and resilience initiatives such as climate-resilient agriculture, watershed development, flood control, coastal protection, and disaster-risk reduction. India uses climate budget tagging to estimate the climate-relevant share within broader development programmes.

Sitharaman highlighted that India will continue to invest heavily in renewable energy , noting that the country has already achieved two-thirds of its renewable commitments nearly four years ahead of schedule . India’s non-fossil power capacity has expanded rapidly, strengthening energy security while reducing dependence on imported fuels.

She also pointed to funding provisions in the Union Budget 2026–27 for carbon capture strategies , which are being incentivised for wider adoption. The move signals India’s intent to support next-generation decarbonisation technologies alongside scaling solar, wind and green hydrogen.

Emphasising the growing importance of resilience, Sitharaman said climate policy must balance emission reduction with adaptation and preparedness , particularly for vulnerable populations facing extreme weather risks. Investments in climate-resilient infrastructure and agriculture are becoming central to India’s development planning.

Making a broader diplomatic point, she reiterated India’s position on climate justice , arguing that countries with lower historical emissions should not bear equal financial burdens. She called for differentiated responsibility in financing climate action, warning that uniform cost-sharing could unfairly burden developing economies.

India’s climate spending push is increasingly viewed as both an environmental necessity and an economic strategy driving green industrial growth, job creation, energy independence, and positioning the country as a key player in the global clean-technology transition.