Advances in Consumer Research
Issue:6 : 136-141
Research Article
Pricing Green Bonds and Measuring Climate Risk in India’s Sovereign and Corporate Debt
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1
Assistant Professor, K.M.C. College Arts Science And Commerce, Khopoli, University of Mumbai, Mumbai email: sanjaydayare20@gmail.com
2
Associate Professor, NSS College, Tardeo, University of Mumbai, Mumbai email: mungase777@gmail.com
3
Fellow B, Mumbai School of Economics and Public Policy, University of Mumbai, Mumbai email: supriyanikam2002@gmail.com
4
Professor, Mumbai School of Economics and Public Policy, University of Mumbai, Mumbai email: kothesk@gmail.om
Abstract

The quick development of the green finance in the emerging economies has put the green bonds at the center stage of the capital mobilization strategy towards climate-resilient infrastructure. India is a fast-growing bond market in the world where the sovereign and corporate green bonds have been on the increase following the launch of the Sovereign Green Bond Framework in 2023. Nevertheless, even with this development there are still problems in pricing these instruments appropriately and how to incorporate the risks associated with climate in the forecasting of the value of debt-market instruments. This paper focuses on the dynamics of prices of green bonds in India, investigates into the existence of the so-called greenium (green premium), and assesses the role of climate properties on the yield of sovereign and corporate debt. The paper determines gaps in climate-risks disclosures, integration of credit-ratings and investor perceptions by using a qualitative review of the recent issuances, market data and international benchmarks. The results point out that systematic climate-risk pricing is not well developed although greenium of Indian green bonds is sometimes small. The research is concluded with the policy recommendations to promote transparency, risk modelling and regulatory standards to promote the long-term sustainability of India debt market.

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