Outlook Planet C3: India Has Capital for Climate Transition but Lacks Bankable Projects, Says SBI’s Bavani Sankaran

The constraint on India's climate transition is not a shortage of capital but it is a shortage of well-structured projects, said Bavani Sankaran S, Chief General Manager at State Bank of India's Project Finance & Syndication Business Unit.

Speaking at the Outlook Planet C3 – Climate Circularity Community - Summit & Awards today, he said that India's transition to net zero will require an estimated $10 trillion in investment and the money is already there.

"No bankable project in this country is starved of finance," Sankaran told delegates. What determines bankability, he explained, comes down to three fundamentals: raw material availability, technology viability, and most critically, offtake arrangements.

"Finance is available. The real question is bankability. Bring us bankable projects," he noted.

He further explained with an example where SBI was recently approached to finance a proposed five-million-tonne green hydrogen plant. The technology checked out. Feedstock was not a concern. But the promoter had secured offtake commitments for just 20% of capacity, expecting market demand to fill the rest over time.

"We deal with public money. We are trustees of that capital," Sankaran said, drawing a sharp distinction between commercial banks and venture capital. He stressed building for what one can sell, then scale.

Sankaran further traced the evolution of how banks assess risk. The traditional "3 Cs" — capacity, character, and capital — have since expanded to include collateral and cash flows. Today, he said, there is a sixth that cannot be ignored: climate.

The urgency, he acknowledged, has compounded alongside a proliferation of crises. From the Covid-19 pandemic and geopolitical conflicts to food insecurity and fuel disruptions, the past five years have produced so many so-called 'Black Swan' events that the term has effectively lost its meaning.

Climate sits at the intersection of all of them. Breached temperature thresholds, erratic monsoons, rising sea levels, and prolonged seasonal extremes are no longer outliers — they are shaping credit risk in real time.

On the financing side, Sankaran outlined a broad structure: roughly 30% of climate investment is expected to come from project promoters and global institutional investors — pension funds and sovereign wealth funds increasingly willing to co-invest with Indian entrepreneurs. The remaining 70% will fall to banks.

He also flagged governance as a material obstacle. Proposals that claimed investor backing but refused to share term sheets citing confidentiality, he said, posed an impossible due-diligence challenge for institutions holding the majority stake.