India climate-tech funding may reach USD 1.9 billion in 2026 as growth capital expands: Report

New Delhi: India's climate-tech and deep-tech sectors could see fresh investment opportunities in 2027 as domestic growth funds expand, government-backed financing gains traction and energy security drives demand for clean technologies, although funding remains concentrated in a handful of large transactions, according to an Ostara Research report.

The report, Ostara Climate Tech and Deep Tech Review 2026, said Indian climate-tech companies raised USD 791 million across 74 equity funding rounds between January and May 2026. Five late-stage transactions accounted for 71 per cent of the total, highlighting the growing concentration of capital in larger deals.

If the funding pace recorded during the first five months continues, full-year climate-tech equity funding could reach approximately USD 1.9 billion, the report said, clarifying that this is an indicative run-rate projection rather than a forecast.


The report identified the shortage of growth capital between Series B and Series C as a key constraint for Indian deep-tech companies. However, the emergence of domestic investment vehicles could improve funding availability over the next 12-18 months for companies seeking to scale their operations.

It highlighted opportunities in four areas for 2027: deep technology, energy storage, green asset financing and energy-efficient data-centre infrastructure.

The report noted that India's climate investment priorities have increasingly shifted towards energy security and reducing import dependence, alongside decarbonisation. Disruptions to supplies through the Strait of Hormuz have reinforced the importance of developing domestic alternatives and strengthening manufacturing capabilities in solar cells, batteries and critical minerals.

India's battery manufacturing sector, in particular, faces a substantial capacity gap. While 40 gigawatt-hours of capacity has been awarded under the advanced chemistry cell production-linked incentive scheme, only 1.4 GWh had been commissioned, against demand projected to rise from 28 GWh in 2025 to 272 GWh by FY30.

Government-backed financing is also becoming more significant. The Rs 1 lakh crore Research, Development and Innovation Fund has begun disbursing capital, while the Technology Development Board had approved 22 projects by July 2026, according to the report.

Energy storage is emerging as another key investment area as the transition increasingly depends on storing and delivering renewable electricity when required. The report also identified opportunities in financing clean-energy adoption among consumers and micro, small and medium enterprises.

It said the next phase of India's climate transition would depend on capital reaching not only technology developers but also manufacturing, infrastructure deployment and financing businesses that make clean technologies commercially viable.