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PE investments in green tech surge

Green is the colour of both environment-friendliness and business opportunity, from the way private equity and venture capital (PE and VC) investments are moving this year.

business Updated: Nov 08, 2009 21:22 IST
Devraj Uchil

Green is the colour of both environment-friendliness and business opportunity, from the way private equity and venture capital (PE and VC) investments are moving this year.

A recent report by Greentech Media said that venture capital investment in green technologies grossed over Rs 5,633.7 crore ($1.2 billion) in 85 deals in the second quarter of 2009. That is a 43.5 per cent increase from Rs 3,924.8 crore ($836 million) in 59 deals made in the previous quarter.

“The number of new clean tech initiatives, start-ups, fast-growing companies and investment funds focused on financing these developments are increasing rapidly,” said Bijal Doshi, India head of EuroMax Capital.

A report by the Coalition for Innovation, Employment and Development (CIED) estimates at least 10 million jobs to be created over 25 years as a result of emerging green technologies.

“Investment in green technology is very important, especially in the power sector. It would be as important for the Indian economy as telecom was in the first decade of the century,” said Pawan Chopra, director of Dua Consulting.

While the prospects are strong, green investments also involve high risk and long gestation periods as the field is new.

Solar power led the investment arena with over Rs 1,549.2 crore followed by automotives at Rs 948.3 crore and energy storage at Rs 845 crore.