He said agriculture is already exposed to climate shocks, including losses from erratic weather and other climate-related disruptions. At the same time, the sector offers scalable opportunities through low-carbon agriculture, methane reduction, improved efficiency, livestock-linked biogas systems, decentralised renewables, solar pumps, mini-grids, waste management and land-use solutions.The core constraint here is not ideas, but distributed financing models,” he said, adding that risk underwriting, credit enhancement and confidence-building mechanisms will be critical to moving capital into rural climate solutions.
Krishnan said one of the biggest gaps in India’s climate finance landscape is the adaptation finance deficit. While mitigation finance has attracted greater attention, private capital has remained limited in adaptation because returns are often less visible, even though resilience is essential for communities exposed to climate risks.
“Private sector normally allocates capital where returns are visible, not where resilience is essential,” he said. “The credibility of our net zero commitment depends on fixing adaptation finance.”He said development finance institutions such as NABARD have a key role in correcting this imbalance because they operate at the intersection of finance, livelihood and sustainability. NABARD, he added, is positioning itself as a rural transition bank, with a mandate to ensure that climate risks do not become drivers of rural exclusion.
“Our strategic intent is to prevent climate risk from becoming a rural exclusion, and to convert these risks into investable rural climate assets,” he said.
NABARD’s Climate Strategy 2030
Krishnan outlined NABARD’s Climate Strategy 2030, built around four pillars: Scaling climate-aligned green lending, developing blended finance and first-loss instruments, integrating ESG and disclosure frameworks internally, and mobilising global capital for rural climate pipelines. He also pointed to NABARD’s Green Lending Facility, impact and carbon funds, and partnerships to create data systems for climate-resilient agriculture.
He said India’s policy and financial architecture is gradually creating the enabling ecosystem required for climate finance, including the climate finance taxonomy, RBI’s disclosure framework, green deposits, GIFT City mechanisms and the expansion of priority-sector-linked instruments. However, he said these tools must now be channelled into aunified climate finance ecosystem across institutions.
For the rural transition to move from concept to scale, Krishnan said capital must reach village-level institutions and assets that directly influence livelihoods. This includes small farmers accessing climate-resilient inputs, farmer collectives financing green assets and rural households shifting to clean energy.
“Net zero will be decided in farms, forests, watersheds and village institutions, not in boardrooms. Climate finance must reach where risk is highest, and not just where returns are visible,” he said.
