India has emerged as one of Asia’s fastest-growing green economies, generating an estimated $110 billion in green revenues in 2025, according to the latest Investing in the Green Economy 2026: Resilience and Reacceleration report released by the London Stock Exchange Group (LSEG). The report highlights the country’s rapid expansion in clean energy and sustainable technologies, supported by robust investments and strong policy focus.

The study notes that India’s green economy has recorded a compound annual growth rate (CAGR) of 20 per cent over the past five years, making it one of the fastest-growing markets for environmentally sustainable industries in the region. The impressive growth has been driven by increasing investments in renewable energy, green infrastructure, and technologies aimed at reducing carbon emissions.

India has also strengthened its position as a major clean energy investment destination. During 2025, the country attracted $100 billion in clean energy investments, making it the second-largest recipient in Asia after China. The report further states that 83 per cent of capital allocation in India’s power sector was directed towards clean energy projects, underlining the country’s commitment to expanding renewable energy capacity while reducing dependence on fossil fuels.

The report identifies India as a leader in several specialised green technology segments. The country contributes 87 per cent of Asia’s green revenues from biogas energy equipment and accounts for 75 per cent of the region’s revenues from advanced irrigation systems and devices. These figures reflect India’s growing capabilities in developing sustainable technologies that support both clean energy generation and efficient agricultural practices.

Across Asia, green industries continued to perform strongly in 2025. The region accounted for 47 per cent of global green revenues, led by China with a 41 per cent share, followed by Japan, Hong Kong and South Korea. Overall, Asia’s green economy expanded at a 12 per cent CAGR over the last five years, surpassing the global average growth rate of 10 per cent.

Despite these gains, the LSEG report points out that energy security remains a key challenge for India and other Asian economies. The region continues to rely heavily on imported fossil fuels while simultaneously accelerating investments in renewable energy. Asia also remains a significant contributor to global coal demand and investment, with China, India and Southeast Asian countries continuing to use coal to meet rising energy needs.

Globally, the green economy crossed a significant milestone in 2025 by surpassing $10 trillion in market capitalisation for the first time. According to the report, if the green economy were considered a standalone industry, it would rank as the world’s third-largest sector, behind only technology and industrials, while exceeding healthcare in market value. Green bond issuance also reached a record $605 billion during the year, with the Asia-Pacific region witnessing the fastest growth in bond issuance.

The report further notes that the global green economy has consistently outperformed broader equity markets since 2008, reinforcing investor confidence in sustainable businesses. India’s strong performance in clean energy, green technology and sustainable infrastructure places it among the leading contributors to Asia’s transition towards a low-carbon economy, while positioning the country for continued long-term growth in the global green sector.