Investor Perception and Participation in India’s Green Bond Market

DOI

10.2991/978-94-6463-612-3_19How to use a DOI?

Keywords

Green Bonds; Investor Perception; ESG Criteria; Market Participation; Sustainable Finance

Abstract

This study explored investor perceptions and participation in India’s green bond market, a rapidly growing segment since its introduction in 2015. The purpose was to understand the motivations, risk perceptions, and decision-making processes of both institutional and retail investors. The research aimed to fill a significant gap in the literature, where existing studies often focused on market performance and regulatory frameworks, but seldom on investor behavior specific to green bonds in India.

Mixed methods were used, integrating quantitative data from a structured questionnaire and qualitative insights from in-depth interviews with key stakeholders. Descriptive statistics were used to summarize the data, and inferential statistics, including correlation and regression analyses, were applied to identify relationships between investor perceptions, ESG (Environmental, Social, and Governance) criteria, and participation levels. A method of purposive sampling was applied, targeting 150-200 respondents for the quantitative survey and 15-20 key stakeholders for qualitative interviews.

The findings indicated that investor participation in India’s green bond market was influenced by a combination of financial returns, perceived environmental impact, and the credibility of issuers. Institutional investors were found to prioritize ESG criteria more heavily, while retail investors focused more on financial performance. Regulatory support and market transparency were also critical in building investor confidence.

However, the study acknowledged certain limitations, including the geographic focus on India, which might limit the generalizability of the findings to other markets. Additionally, the study’s reliance on self-reported data could introduce bias. Despite these limitations, the study provides insightful information for regulators, policymakers, and market participants. It suggests that enhancing transparency, standardizing reporting practices, and increasing investor education on the long-term benefits of green bonds could significantly boost market participation.

In conclusion, while the interest in green bonds among Indian investors is growing, addressing challenges such as limited awareness, perceived risk, and lack of standardization is essential for further market development. The studies suggest for strengthening the regulatory framework and fostering a more informed investor base, which could contribute to the sustainable growth of India’s green bond market.

Copyright

© 2024 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Prachi Malgaonkar
PY  - 2024
DA  - 2024/12/31
TI  - Investor Perception and Participation in India’s Green Bond Market
BT  - Proceedings of the 5th International Conference on the Role of Innovation, Entrepreneurship and Management for Sustainable Development (ICRIEMSD-2024)
PB  - Atlantis Press
SP  - 294
EP  - 304
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-612-3_19
DO  - 10.2991/978-94-6463-612-3_19
ID  - Malgaonkar2024
ER  -