India ranks ninth in the list of top 10 countries for climate technology investment over the past five years and Indian climate tech firms received USD 1 billion in venture capital (VC) funding from 2016 to 2021, according to a new report released in London on Tuesday.
"Five Years On: Global climate tech investment trends since the Paris Agreement", by London & Partners and Dealroom.Co, analysed the trends in the sector since the last United Nations Conference of Parties (COP) in Paris and ahead of the COP26 summit in Glasgow next week.
It found that venture capital investment into climate tech companies globally has skyrocketed since the Paris Agreement, with the US and China leading the global top 10 with USD 48 billion and USD 18.6 billion investment between 2016 and 2021 respectively. The UK comes in at No. 4 with USD 4.3 billion after Sweden at USD 5.8 billion.
"Countries around the world need to work together so that we can collectively change business practices and commit to net zero emissions," said Hemin Bharucha, Country Director India, London & Partners - London's business growth agency.
"The global tech industry plays a pivotal role in accelerating this global transformation and this is demonstrated in the rapid growth of VC investment into global climate tech companies. It is fantastic to see the UK and India among the top 10 countries for climate tech investment globally, with London leading the way in Europe for the number of climate tech companies and dedicated VC funds," he said.
The global top 10 is completed by France at No. 5 (USD 3.7bn), Germany at No. 6 (USD 2.7bn), Canada at No. 7 (USD 1.4bn), the Netherlands at No. 8 (USD 1.3bn) and Singapore tenth (USD 700m), after India.
Overall, global climate tech VC investment soared from USD 6.6 billion in 2016 to USD 32.3 billion in 2021, an increase in funding by almost five times.
According to the report, which analyses technology companies working to reduce Greenhouse Gas emissions or addressing the impacts of climate change, 2021 investment levels have already exceeded the whole of 2020 for global climate tech investment, demonstrating the importance of the global tech industry in the fight against climate change.
Europe is found to be the fastest-growing region globally for climate tech, with European VC investment into climate tech firms seven times higher this year than in 2016 (up from USD 1.1 bn to USD 8bn).
In Europe, London is described as one of the world's most advanced ecosystems for climate tech, with its start-ups raising USD 3.3 billion since 2016, accounting for 16 per cent of Europe's total. London is also home to 416 climate tech companies, the biggest cluster in Europe.
"The UK is well on its way to becoming a climate tech powerhouse thanks to its combination of world-leading research, thriving ecosystem and creative entrepreneurs that are using technology to solve the most pressing issue in our lifetime," said Remus Brett, Partner at VC firm LocalGlobe.
"It's no wonder then that investors across Europe and the world are taking note of the startups and scaleups being created in London and the rest of the country. With sustained investment and the right support, these companies will have the tools they need to successfully reduce greenhouse gas emissions and fight the climate crisis," he said.
Growth in climate tech is being driven by significant investment into transportation and energy solutions, accounting for a combined total of 78 per cent of global climate tech investment in 2021. A similar trend is reflected in London, with 60 per cent of VC investment into climate tech going into energy companies, while enterprise software, circular economy and food start-ups are also attracting an increasing share of investment.
London ranks second globally behind the San Francisco Bay Area for number of funding rounds raised by climate tech start-ups, demonstrating an active early-stage ecosystem in London, according to London & Partners.
The city's promotional agency added that climate tech start-ups in London also have access to deep pools of dedicated climate tech capital, with the city home to 18 dedicated climate tech VC firms, more than anywhere else in Europe.
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)