Growing environmental concerns and venture capital funding, combined with government regulation, make clean technology the business opportunity of the new century. It is vastly more than "feel-good" because there is money to be made and marketing opportunities for those who succeed.

But should a developing economy like India regard the push to clean technologies as a negative on growth? Or can it embrace clean technologies and sustainability in a way that inspires the rest of the world? One of the most offensive views in the West is that India and China will plough on with development, carelessly creating pollution, because it is "their turn" to grow and enjoy material wealth. The view is certainly mistaken for India where I have found an awareness of "sustainability" way above awareness in the West.

The opportunity for India is that investment in cleaner products and technologies can lead to a potent new source of innovation and competitive advantage. We are all operating in a dramatically changed market – for example, it used to be that "green products don''t work" and consumers won''t pay a premium for them. Not any more.

Bankers are certainly awake to this shift, including Indian bankers. According to Somak Ghosh, president, corporate finance and development banking, Yes Bank, it makes sense to invest in clean technologies because of the combined community and government focus on climate change. He was speaking at the third CleanTech Forum, held in Melbourne, Australia, that brought together investors and product developers. The first India CleanTech Forum, in association with the Confederation of Indian Industries, will be held in New Delhi on 3 August, 2007.

In the modern world of climate change where we realise we all depend on each other, issues of economic diversity, accountability and equity can no longer be delegated to the public affairs and marketing teams; they go to the heart of business. In this new era, companies must act with sensitivity to the environmental, social and cultural impacts of global expansion. In other words, it is about time business showed respect for the billions of current and future customers.

Climate change signals a new imperative where the business community has to create a new form of globalisation that takes the environment into account – not just tokenism on the edges, but at the core of business.

This is a huge issue for India. Ghosh actually said India''s biggest challenge was to balance growth and sustainability, calling for a change of mindsets to ensure sustainable growth. On the energy side, he said India''s energy security was impacted by high reliance on oil imports, with about 70 per cent of requirement imported. At the same time, it faces high environmental costs because of dependence on oil and coal as energy sources. To counter this, government had placed increased focus on clean energy, including hydro, wind and bio-diesel.

He also said that while there was a pressing need to develop infrastructure, with spending now at 3.6 per cent of GDP and needing to rise to 7 per cent or 8 per cent, there would also be a need to assess environment and social impact of projects.

Yes Bank is one of India''s new private sector banks, the only "greenfield" private sector bank set up in the last decade. The management team has the highest ownership levels of any bank in India. The bank concentrates on corporate and business banking. Yes Bank received the ''environment leadership award'' from US AID for outstanding contributions made through working in partnerships to improve the environment and quality of life for the people of Asia.

Faced with these challenges, India has to improve social infrastructure, ensuring a trickle down of economic benefits to those at the bottom of the pyramid.

Moves to clean technologies in India are being driven by deteriorating air quality due to vehicular emissions and untreated industrial smoke, with major Indian cities having ten times the legal limit for particulate matter. At the same time only 7 per cent of solid waste is treated. On top of this, the 90 per cent reliance on coal and energy as a source of energy means carbon emissions in India grew by 65 per cent over the past five years, making India the second highest growth behind China.

But to counter this, regulations on air and water pollution levels are forcing industry and government bodies to adopt cleaner technologies, and this demand will grow because the cost of energy using clean technologies is becoming competitive with traditional sources, thereby creating the commercial imperative to invest in clean technologies.

Ghosh told the conference there were three major market segments for clean technology:

• Renewable Energy – wind, solar, small and mini hydro projects and energy from waste
  
• Environment Management – water filtration, industrial and vehicular air pollution, energy from waste, waste water treatment, solid waste management
  
• Rural Economy – technologies for organic farming, greater composting to replace fertilisers and localised technologies for energy such as solar street lighting and shared power generation

He estimated the market for environmental technologies at $5.29 billion in an overall market growing at about 15 per cent since the 90s. For example, energy efficiency and renewable energy had grown at 15 per cent, water and wastewater treatment grew 6 per cent, solid waste management 10 per cent, air pollution control 15 per cent, environment consulting 20 per cent and hazardous waste management 7 per cent. Factors responsible for growth included tightening environmental regulation, increasing community consciousness and financial incentives provided by government.

Looking at specific opportunities, Ghosh focused on renewable energy, including wind farms, small run-of-river hydro, energy from waste and solar technologies.

He said other opportunities include effluent treatment plants for industrial waste, disposal and treatment of waste and landfill materials in urban areas for municipal solid waste management, fly ash management and utilization technologies, emission monitoring for transport and CNG and multi-fuel engines.

Ghosh said there were real opportunities for business in Australia and India to work together on clean technologies and he pointed to technology providers, equipment manufacturers, financiers and service providers as areas for collaboration. His advice was that selection of partners was the key to success.

India-Australia trade has grown from just A$1.4 billion in 2000-01 through to A$5.7 billion in 2005-06 and now estimated close to A$10 billion. The major component of the relationship is minerals and natural resources from Australia as well as education.

Many Indian companies have a presence in Australia, including Infosys, Polaris, Oswal Group, Aditya Birla, Tata Consultancy Services, Asian Paints, Mahindra British Telecom and VISA International (mining).

Ghosh concluded that clean technology provided a strong incentive for further cooperation and growth in the India-Australia economic relationship.

He''s not the only one who thinks there can be global collaboration on clean technologies. The state of California is actively searching around for like-minded countries to team up for clean technology development together. California is already committed to Australia and is looking at India. On a global scale, they see this clean technology collaboration creating a new kind of Silicon Valley effect, a real concentration of effort and teamwork that will impact globally. Will India grab this new clean technology opportunity?