New Delhi, Jan. 15 -- Investor interest in sovereign green bonds has been steadily declining over the past two years, forcing the central government to think up new ways to get them going.

Consequently, the upcoming Union budget for FY27 may offer tax rebates for green bond buyers to make the climate finance instrument more attractive, according to two officials aware of deliberations within the government.

"The investor interest in sovereign green bonds has been subdued and the interest rates of these bonds compared to that of other bonds is also largely at a similar level, which makes green bonds less attractive," one of the officials cited above said on the condition of anonymity. "Therefore, there is a consideration to incentivize b...