March 15, 2024

By Lynda Kiernan-Stone, Global AgInvesting Media

Green Climate Fund (GCF) has backed its first climate venture fund in India, marking a collaborative effort to advance climate resilience and sustainable development in the country by committing $24.5 million to Avaana Capital’s Avaana Climate and Sustainability Fund. 

Recognized as the largest climate fund in the world, GCF was established in 2010 to mobilize finance in developing countries for the adaptation and mitigation of climate change effects, targeting key areas such as energy transition, mobility, supply chains, sustainable agriculture, and food systems.

As of December 2023, the fund had grown to $13.5 billion in funding and co-financing of $51 billion across 243 projects. Each dollar of these investments made by GCF has attracted approximately $3 of investment from private sector partners, according to the U.S. Treasury, which supported the fund from its inception with $2 billion for its Initial Resource Mobilization. 

The investment in the Avaana Climate and Sustainability fund was granted approval during GCF’s 38th Board Meeting held in Kigali, Rwanda on March 5, 2024, marking a significant stride toward fostering climate innovation and sustainability in India. 

“We are delighted to share the news of the Green Climate Fund Board’s approval of Avaana Capital’s Climate and Sustainability Fund,” said Anjali Bansal, managing founder, Avaana Capital. 

“This milestone represents the culmination of dedicated efforts, with gratitude extended to the Green Climate Fund team, including Rajeev Mahajan, Ayaka Fujiwara and Donggun Kim, for their unwavering support and guidance throughout this journey. We also acknowledge the leadership of Kavita Sinha and Soji Omisore in making this partnership a reality. This collaboration underscores GCF additionality and our shared commitment to advancing climate action.”

Avaana Capital explained that its philosophy centers on the belief that substantial outcome creation along India’s path to net zero calls for an ecosystem approach integrating critical elements of technology, policy, industry, and academia. 

To manifest this, the firm stated that it integrates and works across four ecosystems: digital innovation; industry linkages; policy and academia; and catalytic capital, creating a framework resulting in insights and thought leadership that position Avaana at the forefront of emerging technologies and investment classes. 

Along the way, the Avaana Climate and Sustainability fund follows a proactive, thesis-led sourcing approach for tracking leading entrepreneurs and follow-on investments in portfolio companies that enable them to achieve scale. 

“The Green Climate Fund’s investment in India’s first tech-led climate VC underscores the transformative impact that technology and innovation have in carving low-emission and climate-resilient development pathways,” said Bansal. “It also further highlights the potential that India presents in developing solutions for mitigation and adaptation that are affordable and inclusive, enabling a just transition.”

Avaana also extended their recognition and gratitude to mission-aligned institutions including SIDBI’s Green Finance Vertical team for their role as the GCF Accredited Entity.

“The Green Climate Fund is proud to partner with Avaana Capital, and SIDBI, a GCF Direct Access Entity, to support the Avaana Sustainability Fund that aims to support commercialization of local, early-stage climate technology ventures,” said Kavita Sinha, director, private sector facility, GCF.

“These climate technology ventures will enable India’s transition to a low emissions, climate resilient future. This partnership exemplifies our shared commitment to fostering climate resilience and sustainable development in India, especially for those most vulnerable to the impacts of climate change.”

~ Lynda Kiernan-Stone is editor in chief with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

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