Overcoming Barriers to Climate-Smart Agriculture Financing in India

A new report by Samunnati identifies major obstacles in financing Climate-Smart Agriculture (CSA) in India, including lack of incentives, risk perception by financial institutions, and unclear guidelines. Recommendations include creating special credit schemes, establishing CSA funds, and promoting green bond finance to support climate financing.

A new report highlights major hurdles in financing Climate-Smart Agriculture (CSA) in India. Samunnati, which provides financial support to farmers, identified these barriers as lack of incentives, financial institutions viewing CSA as risky, and unclear guidelines.

The report suggests solutions like special credit schemes, creating dedicated CSA funds, clear guidelines, piloting blended finance models, and raising green bond finance from international markets to support CSA financing.

Despite agriculture's significant role in greenhouse gas emissions and poverty reduction, it is excluded from India's national climate plans. The report emphasizes the urgent need for targeted investment to make agriculture more climate-resilient, proposing incentives such as lower interest loans for adopting climate-friendly technologies.

(With inputs from agencies.)