emdes expectations. india had committed to the cop26, its panchamrit goals ( nationally determined contributions ( ndcs ) ). it is estimated that the funding requirement to achieve these targets ranges around usd 160 billion per year10. there are manifold challenges both at national and international levels for the effective flow of sustainable finance. first and foremost is inherent riskiness of the green or sustainable projects / proposals. at the forefront of climate risk mitigation is going to be the availability of green and sustainable substitutes which requires considerable technological development. given the fact that, green or sustainable projects are based on relatively newer technologies which are yet to stabilise and are mainstreamed, assessment of financial and techno - economic viability of these projects becomes that much more challenging. this leads to an inherent increased credit risk as compared to traditional projects. 4 / 6 bis - central bankers'speeches moreover, when it comes to sustainable finance, in a country such as ours, apart from mitigation, flow of resources for adaptation is equally important. bankable projects invariably find credit, however there are issues with partially bankable and nonbankable projects, which generally gets associated with adaptation. several issues in the form of data, knowledge and capacity gaps, technical, and institutional constraints limit the proper identification and development of adaptation projects which limits the access to both international as well as private finance. there is, thus an urgent need to develop an ecosystem to mainstream adaptation finance and to rise above the typical corporate social responsibility linked funding and public investments. the government has also been at the forefront in fostering sustainable and climate finance be it green hydrogen mission, national solar mission, pm - kusum, pmsuryaghar yojana, sovereign green bonds, long - term low emission development strategy ( lt - leds ) etc. there is a need to further augment these efforts by forging public - private partnerships and look at blended finance options, including the role of development financial institutions ( dfis ). efforts are needed to address commercial viability of projects and related market failures, along - with transparency, integrity, and disclosures. there is a need to collectively think as to how sustainable projects involving new and evolving technologies can be derisked without subjecting the financial system to any spill - over risks. there is also a need for more intense focus on promoting research & development in the area of sustainable technologies. a related area that comes up for discussion at various fora is the non - availability of

interesting because the level of competition is going to increase manifold, both for customers as well as for talent, transforming even the sleepiest areas in financial services. profitable because new technologies, information, and new techniques will open up vastly new business opportunities and customers. challenging because competition and novelty constitute a particularly volatile mix in terms of risk. in this talk, i will speak about how we see these aspects at the central bank. interesting and profitable over the next year, 17 new niche banks will begin business. in addition, licensing for universal banks is now on tap, so fit and proper applicants with innovative business plans and good track records will enter. fintech will throw up a variety of new ways of accessing the customer and serving her, so new institutions that we have little awareness of today will soon be a source of competition. these will finally draw customer sectors, firms, and individuals without access today into the formal financial system. those customers that are already being served will be spoiled for choice. bis central bankers ’ speeches for the service provider, even though greater competition will tend to reduce spreads, access to new customers and new needs will increase volumes. moreover, risk - and cost reduction through information technology and risk management techniques will tend to increase effective risk - adjusted spreads. in sum then, despite increased competition, profitability can increase. the comparative advantage of banks may lie in their access to lower cost deposit financing, the data they have on customers, the reach of their network, their ability to manage and warehouse risks, and their ability to access liquidity from the central bank. these should then be the basis for the products they focus on. perhaps a couple of examples may be useful. india will have enormous project financing needs in the coming days. even though bankers are very risk averse today, and few projects are coming up for financing, this will change soon. what is in the pipeline is truly enormous – airports, railway lines, power plants, roads, manufacturing plants, etc. bankers will remember the period of irrational exuberance in 2007 - 2008 when they lent without asking too many questions. i am hopeful that this time will be different. here are ways it can be different and risks lowered. first, significantly more in - house expertise can be brought to project evaluation, including understanding demand projections for the project ’ s output, likely competition, and the expertise and reliability of the promoter. bankers will have to develop industry knowledge in key areas since consultants can be biased. second, real risks have