New Delhi, July 23 : Centre's move to develop climate finance taxonomy, as announced in the Union Budget on Tuesday, will help standardise green bond and green finance markets in India, said experts.

In her seventh budget speech, Union Finance Minister Nirmala Sitharaman announced plans to 'develop a taxonomy for climate finance for enhancing the availability of capital for climate adaptation and mitigation'.

'This will support the achievement of the country's climate commitments and green transition,' she said.

'These are steps on the right path because India's energy security requires diversity in the energy mix,' Hisham Mundol, Chief Advisor, Environmental Defense Fund in India, told IANS.

'The development of a taxonomy for climate finance will provide the required standardisation and transparency to rapidly globalise our green bond and green finance market,' added Ramnath Iyer, CEO & Co-Founder of ESGDS.

To support energy transition -- critical in the fight against climate change -- the FM proposed to 'expand the list of exempted capital goods for use in the manufacture of solar cells and panels in the country'.

"'This budget is a crucial step forward for adoption of green energy. Finance Minister Nirmala Sitharaman highlights the budget's strong emphasis on climate resilience. Expanding the list of exempted capital goods to solar energy projects is crucial for accelerating the transition to green energy. As the world's third largest GHG emitter, emissions reduction in India is a global priority,' Iyer said.

The budget also strengthens the regulatory framework to support green housing.

'This could include implementing stricter energy efficiency standards for new green building projects, encourage use of sustainable materials and promote environmental conservation,' he noted.

Mundol 'lauded' the budget proposal for 'raising agricultural productivity and building climate resilient varieties and towards this end the investment in agricultural research and the ambition to transform agricultural research'.

'Overall, this budget will substantially accelerate our transition to a low carbon economy," Iyer said.

/IANS