Indian firms stand to benefit from London’s market positioning as a venue of choice for investors looking to buy green bonds, India offers a sizeable market for UK cleantech SMEs looking to scale. In 2018, the two countries launched a $700m Green Growth Equity Fund, structured as a joint venture between the UK-based Lightsource and Indian private equity firm Everstone Capital. The fund has supported the growth of India’s renewable energy sector, through investments in Ayana Renewable Power, Radiance Renewables, GreenCell Mobility and EverEnviro. India now produces some of the cheapest solar energy in the world, and according to government estimates, it will require 27 GW of grid‐connected battery storage by 2030. However, only one sodium-ion battery energy storage power station exists in Asia, and that’s in China. Much of its installed energy capacity is expected to come from solar power, an energy source with a clear split in day-night output. To make the most of its soaring solar sector, India urgently needs to increase its renewable energy storage capacity to return energy to the grid to sustain peak demand levels and minimise power wastage. British companies Faradion and AMTE Power are seeking to meet the vast demand by setting up a sodium-ion battery plant in India and one of Tesla’s main battery suppliers, CATL from China, announced it would start releasing sodium-ion batteries.
India’s vast solar PV and wind industry are on the radar for investors and project sponsors looking at India’s hydrogen potential; renewable energies could catalyse electrolyser manufacturing and green hydrogen production. Attracting international investment could be key to India achieving its ambitious infrastructure and cleantech goals. After the first Covid lockdown left India’s economy struggling, the Second Wave from April this year further added to the economic downturn. And as the government pours resources into Covid vaccines and fiscal stimulus, India has been left with minimal fiscal room for manoeuvre to support its transition to a green economy. London-based Elara Capital’s India Opportunities Fund is invested in green energy, gas, transmission and infrastructure, and has seen a fivefold increase in net worth in the last year. And PRP Group services for investors has been growing under the radar from India to the UK amidst the pandemic. With significant upside opportunities already available in markets like the US, China and the UK, and faced with an uncertain regulatory, tax and subsidy environment in India, only the most experienced foreign investors and businesses may feel comfortable stepping into the cleantech market in India today.