A Study of Green Finance Expansion, ESG Investment Awareness and Sustainable Finance in India

Sustainable finance has become a major part of the contemporary financial system as more emphasis is put on the issue of environmental and social responsibility by the governments, financial institutions, and investors. This paper explores the expansion of green finance in India and analyzes the extent of awareness among investors about the ESG (Environmental, Social, and Governance) investment practices and the general development of sustainable finance in the Indian financial market. The increase in environmental issues, risks of climate change, and the world commitments in sustainable development has motivated investors to avoid conventional investment practices in favor of responsible and sustainabilitydriven financial instruments. The research uses both the descriptive and analytical research approaches in India with the support of regulatory efforts by SEBI, the sovereign green bond, and national commitments like the net-zero emissions by 2070. The trend of green finance instruments like ESG mutual fund, green bonds and sustainability-linked investments within the period 2020-2025 is understood by analysing secondary data on the topic in the form of reports by reliable financial and institutional sources, including NSE, AMFI, RBI, and reports on sustainability-linked investments provided by SEBI. Furthermore, a structured questionnaire will also be used to collect primary data by administering it on individual investors to assess their awareness, perception, and involvement in ESG-based investments. The results indicate that there is a substantial growth in green financial products, institutionalization of interest, and slow increase in awareness among investors, yet some gaps in knowledge and trust still exist among retail investors. The research will help comprehend the changing environment of sustainable finance in India and give insights to the policymakers, financial institutions, and investors to encourage responsible investment practices and enhance the creation of ESG-oriented financial markets.