D&A 2024 Publications on Innovative Finance
Dear Friends,
As we reflect on the year gone by and welcome 2025, all of us at D&A want to express our gratitude to our colleagues and partners who are part of the collective journey towards building the innovative finance ecosystem in India.
The past year has been a productive one for D&A; it involved the launch of eight new publications that highlighted the varied dimensions of our work in unlocking capital for sustainable development:
Reflecting on this collective range of strategy and market-building work, as well as our transaction advisory mandates and policy advocacy projects, we are optimistic that 2025 will be a pivotal year for innovative finance.
We are looking forward to our continued engagement with visionary foundations, government agencies, and social service providers, and announcing the launch of financing programs in:
We are also deepening our advisory work with impact-focused funders on program design and capital deployment strategies to maximize leverage, impact, and returns.
If you are a foundation, HNI, or commercial funder looking to get involved in innovative finance, please do reach out to me directly or any of my colleagues at Desai & Associates.
We would like to thank all our partners for supporting the work of D&A and look forward to working with more of you in the year ahead to catalyze finance for enabling systems change in India.
Wishing you and your loved ones a very Happy New Year!
Warm regards,
Kartik Desai
Key Publications
Achieving the United Nations Sustainable Development Goals (SDGs) requires substantial financial resources, with Asia needing $1.5 trillion USD annually. Despite the growth of impact investing, with over $1 trillion USD in market size and 24% of global assets allocated to Asia, a significant funding gap remains. Impact investing, which combines financial returns with positive social and environmental outcomes, is essential to bridge this gap. This report explores key enablers, challenges, and recommendations to enhance the impact investment environment in Asia. It covers diverse investor types, enabling conditions, challenges, successful case studies, and actionable steps for policymakers and investors to strengthen the impact investment landscape. By leveraging these insights, stakeholders can mobilize capital effectively to help achieve the SDGs in Asia.
The SDG financing gap in developing countries has surged to $4 trillion, with sectors like Energy and WASH contributing to 70% of the shortfall. In India, climate investments must rise from $18 billion to $170 billion annually to meet net-zero targets. While nonprofit initiatives dominate SDG funding, impact-driven market-based solutions, such as social entrepreneurship, are gaining traction globally at platforms like COP, WEF, and OECD. These innovative solutions require catalytic capital—high-risk, concessionary investments like debt, equity, and guarantees—to unlock third-party funding and address critical market gaps. Despite its potential, deploying foreign catalytic capital into India faces regulatory hurdles. This report explores pathways to overcome challenges, offering solutions to channel US and EU capital into Indian social enterprises and funds, accelerating progress toward sustainable development.
India faces a $2.5 trillion annual funding gap to meet the SDGs, and social enterprises play a crucial role in addressing challenges like poverty, healthcare, education, and environmental sustainability, particularly for marginalized communities. However, these enterprises struggle with limited access to commercial capital. This report explores how blended finance can bridge this gap, offering innovative solutions to empower social enterprises. It delves into their unique characteristics, identifies financing challenges, and highlights the potential of blended finance. The report also examines the three pillars of blended finance and provides case studies and recommendations for sustainable solutions to drive India’s socio-economic growth. By leveraging blended finance, social enterprises can unlock new opportunities, scaling their impact effectively.
领英推荐
India has committed to reducing its greenhouse gas emissions intensity by a third by 2030 (from 2005 levels), requiring an estimated $170 billion annually to meet its Nationally Determined Contributions (NDCs) under the Paris Agreement. However, current green finance flows stand at just $44 billion, revealing a significant funding shortfall. Blended finance offers a transformative solution by mitigating these risks and attracting the necessary needed for climate-related projects. This report provides a comprehensive analysis, exploring blended finance's role in climate action, expert insights on effective structures, case studies, sector-specific strategies for financing climate mitigation and adaptation. It offers recommendations for aligning regulatory frameworks and building synergies within the ecosystem to drive sustainable development and climate resilience in India.
Despite progress through Swachh Bharat Mission and Jal Jeevan Mission, India’s WASH sector faces critical gaps, particularly in urban sanitation, waste management, and water treatment. With a global need of over $1.4 trillion to meet SDG 6, India's funding gap remains substantial. Increased private sector investment is crucial to bridging this gap. This report addresses the need for private involvement in India’s WASH sector, offering an analysis of the current investment landscape, challenges, and policy recommendations. It covers sectoral assessments, investor priorities, profitable ventures, blended finance models, and strategies to align government policies with investor needs. By leveraging these insights, stakeholders can unlock the potential of private investment to drive sustainable growth in India’s WASH sector.
India’s women entrepreneurs face a $158 billion financing gap, with only 20% of MSMEs being women-owned. Our "Gender Lens Investing Toolkit" provides actionable strategies to empower women-led enterprises by integrating gender considerations throughout the investment process. Despite progress in women's entrepreneurship, traditional investment models often overlook their specific needs. This toolkit outlines the business case for Gender Lens Investing (GLI), identifies challenges women entrepreneurs face, and offers a four-stage framework for integrating GLI in investments. It also includes case studies of successful GLI strategies and provides recommendations for investors to enhance gender diversity in their portfolios. By adopting these strategies, investors can enhance the financial performance of their portfolios while promoting gender equality.
The Parinaam 2023 Global Outcomes Financing Summit gathered over 300 leaders from NGOs, impact funds, foundations, investment intermediaries, and policymakers to explore the future of outcome-based financing (OBF) in India. Despite growing interest, OBF in India is still in its early stages, facing adoption and scaling challenges. This report captures key insights, case studies, and recommendations from the summit, offering a resource for stakeholders aiming to leverage OBF for measurable, sustainable development outcomes. It covers OBF strategies, regulatory challenges, case studies, and expert-led workshops, providing guidance on scaling OBF models and fostering multi-stakeholder collaboration to drive social and environmental impact. The report also highlights the critical role of cross-sector partnerships in advancing the Indian OBF ecosystem.
The total global SDG financing gap has increased from $2.5 to $4.2 trillion, with India’s share at ~25% pre-COVID. Despite central and state funding for the social sector reaching ~30% of Nominal GDP, resources continue to remain constrained. This report addresses the need to shift from traditional socio-economic models to innovative financing mechanisms like blended finance. It covers concessional capital, risk mitigation tools, and results-based financing, analyzes India’s current landscape, and identifies high-impact sectors such as healthcare, education, gender equality, and climate change. The report further highlights barriers to adoption and provides strategic recommendations to scale blended finance and drive India’s socio-economic growth. Embracing blended finance is crucial for unlocking new opportunities and achieving sustainable development goals.
At Desai & Associates, we believe that knowledge is the foundation of progress and innovation. Through our reports and publications, we aim to provide you with the tools and insights necessary to navigate the complexities of today's global challenges. Our work is grounded in a commitment to sustainability, equity, and inclusive growth, and we are proud to contribute to the ongoing dialogue in these critical areas. If you would like to learn more about our work or explore how we can support your initiatives, please don't hesitate to contact us. We are here to collaborate and help you achieve your goals. Reach out to us at [email protected] for more information or to discuss potential partnerships.
We hope you enjoyed reading the second edition of the D&A Monthly Round-Up!
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