ESG PERFORMANCE AND THE INDIAN BOND MARKET: A QUANTITATIVE STUDY

Abstract This study looks closely at India’s labelled bond segment—specifically green bonds and sustainability-linked bonds—by using a verified bond-level ledger covering the years 2017 to 2025. The research follows a descriptive and analytical quantitative design and relies entirely on secondary data. For every year in the period, the study reports total amounts raised, the average coupon rates, and the number of issues. To understand how concentrated the market is, issuer dominance is measured through the Herfindahl–Hirschman Index. Pricing behaviour is examined with two simple tools: a Spearman rank correlation to see basic relationships, and an ordinary least squares regression in which the coupon (used here as a proxy for yield) is explained by the tenor of the bond and the year of issue, with robust standard errors to keep the estimates reliable. Two practical questions drive the analysis: first, whether attaching an Environmental, Social and Governance (ESG) label is actually associated with lower coupons once maturity and timing are taken into account; and second, whether participation in this market becomes broader in the later years of the sample. The results point to a normal term-premium pattern (longer bonds pay more), no consistent coupon advantage for green bonds after controls, a visible pickup in issuance from 2021 onwards, and a gradual decline in issuer concentration by 2025. The method is deliberately transparent—only complete observations are used and no missing values are filled in—so that regulators and practitioners can replicate it. The exercise also makes it clear that better tranche-level disclosure, especially from municipal issuers, would make future measurement stronger and more useful for policy.