Environment-friendly initiatives will have easier time to scale the ladder of success

Call it the new normal or something else. Environmental, social and governance-related sectors now offer enormous opportunities for investors and startups. India must cash in on this for more reasons than one.

The Covid-19 pandemic has proven, beyond doubt, to be a wakeup call for humanity and has opened its eyes to the damage it has been doing to the environment. It isn't just India but the entire world has sprung into action post-pandemic. Industrial countries in Asia, like China, Japan, and Korea have all vowed to become carbon-neutral this century and are pushing out initiatives for the same. In an era of globalisation, this has thrown up a great opportunity for all the investors worldwide.

Little wonder therefore, that experts predict that investing on environmental, social and governance grounds can turn out to be a profitable manoeuvre in the post-Covid era, as the government policies seem to favour the same. India is already the world's third-largest producer of renewable energy and has plans to have 40 per cent of its total energy needs met from non-fossil fuel sources by 2030. Environment-friendly initiatives will receive full support from the government and will have a relatively easier time scaling the ladder of success. Naturally, the investors who spot this trend and invest in 'green' startups will also be able to reap significant profits in the near future.

The renewable energy market has grown rapidly in India over the past 4 years, posting a robust CAGR of 17.33 per cent between 2016 and 2020. According to a recent study by India Brand Equity Foundation, the Indian renewable energy market will attract investment worth $80 billion in the coming 4 years. This means there is a myriad of opportunities for both the investors and the startups in the renewable energy segment.

The e-vehicle segment - especially - is getting a lot of attention, with companies like Tesla launching premium e-vehicle models. While those models aren't in the affordable range yet, they've proven that the limitations that were attributed to e-vehicles can be overcome with innovation. They've also inspired other players in the industry – big and small – to venture into the segment and make the most of the opportunities. Experts are betting that the stocks in the electric vehicle supply chain will skyrocket in the near future as the world becomes more environmentally conscious and people grow averse to using fossil fuel based vehicles that cause environmental pollution.

Besides the renewable energy segment, EdTech is the other prominent sector that will witness significant growth in the coming years. Given the rapid transition to online learning platforms that was forced upon us by the pandemic, it is being estimated that the EdTech sector will grow from $2.8 billion in 2020 to $10.4 billion by 2025. There are over 4500 active EdTech startups in the country and more than 500 were added in the last 24 months alone. The opportunities in this sector are plenty and those who enter it early will stand to gain the most. Both the investors and the entrepreneurs are expected and should be encouraged to venture into these domains. It always makes more sense to swim with the current rather than against it.