Climate experts recorded 2024 as the hottest year ever, highlighting the need for immediate Climate Action. Still in 2024, the world’s 65 largest banks gave $869 billion to companies that work with fossil fuels like coal, oil, and gas. That’s more than the $707 billion they gave in 2023. Fossil fuels are the main cause of carbon pollution, which leads to climate change.
Building more fossil fuel projects means the world will keep relying on these dirty energy sources for many years. Experts, like the International Energy Agency (IEA), say we need to cut spending on fossil fuels by more than half by 2030. This is important to help stop climate change and reach net zero emissions by 2050.
SBI’s Role in the Rise of Fossil Fuel Financing
The State Bank of India (SBI), the country’s largest public sector bank, has continued to support fossil fuel projects, contributing to the global rise in fossil fuel use.
In 2024, the State Bank of India (SBI) was the only Indian bank among the world’s top 65 fossil fuel financiers, increasing its support for fossil fuel projects to $2.62 billion — a $65 million rise from the previous year. Though this number is less in comparison of what big global banks give, but it’s still moving in the wrong direction.
Since 2021, SBI has given $10.6 billion to fossil fuel projects. Although SBI has pledged to become net zero by 2055 and aims to make 7.5% of its loans green by 2030, experts say this is not enough. A group called Climate Risk Horizons says Indian banks aren’t doing enough to stop supporting coal. Only two banks in India — Federal Bank and RBL Bank — have said they will stop or give less money to coal projects. No other major Indian banks have made this promise yet.
How India Supports Fossil Fuel Investments
India is one of the fastest-growing countries in the world, and as more people and businesses use electricity, the demand for energy is rising quickly. Right now, most of this energy comes from fossil fuels like coal, oil, and gas. These fuels pollute the air and cause climate change.
Although India has started using more clean energy sources like solar and wind, a big part of the country’s energy system still depends on fossil fuels. Experts are warning that if India keeps spending money on coal and other fossil fuels, it could slow down the switch to cleaner energy.
Also, fossil fuels are no longer the cheapest option. In many places, clean energy like solar power, wind, and batteries to store that energy are now more affordable.
To help fight climate change and keep up with the rest of the world, Indian banks and government leaders need to stop putting so much money into fossil fuels and instead invest more in renewable energy. This will help India grow in a cleaner and healthier way.
Fossil Fuels Worldwide: What the Data Shows
In 2024, a lot of big banks didn’t stick to their promises to fight climate change. European banks, which used to be more careful about not supporting polluting companies, also started loosening their climate rules.
In the US, a major bank called Wells Fargo gave up its goal to stop polluting by 2050. Around the same time, President Trump pulled the US out of the Paris Agreement and stopped supporting green energy projects and instead his government is pushing fossil fuels like oil, gas, and coal more strongly.
Need To Break The Fossil Fuel Cycle — Before It’s Too Late
In 2024 alone, banks significantly increased their funding to fossil fuel companies, helping these companies grow bigger and more powerful, , even though the world needs to move away from fossil fuels.
To combat climate change effectively, governments, banks, and investors must shift their focus away from fossil fuels and increase support for renewable energy. Reducing fossil fuel financing is a crucial step toward protecting the environment, improving public health, and building a cleaner, more resilient energy system for future generations.
Explanation of Few Terms Used Here:
Paris Agreement – a worldwide plan to fight climate change.
International Energy Agency (IEA) – is a global organization established after the oil crisis and works to ensure reliable, affordable, and clean energy.
Net zero – Net zero means not adding extra pollution to the air.