India is the third-largest country in energy investments but it needs to do more to reach its goal of producing renewable energy.

India’s energy sector is experiencing a transition with increasing penetration of renewable energy in the energy mix. One of the major impediments in the process of such a transition is to secure the necessary finance to achieve the transformative goal of producing 175 gigawatts of renewables by 2022. The problem gets compounded with limited budgetary resources, conjugated with difficulties associated with mobilizing private capital for the sector. With this backdrop, we offer a granular understanding of the associated challenges of mobilizing such finances, drawing from India’s perspective. We identify the emerging pathways of financing renewables and the inherent challenges. The findings are quite revealing. Financing of renewable energy in India continues to face multiple conundrums, largely entrenched with the nature of current financial market in India in general, such as short tenure of loans, high capital costs, and lack of adequate debt financing etc., as well as with the sector-specific issues of the renewable energy sector. The success of introducing innovative financing mechanisms and instruments requires necessary conditions to prevail.