"We expect global green bond issuance to eclipse $250 billion in 2018, a more than 60 per cent increase over the $155 billion of green bonds issued in 2017," Moody's investor service report said.
"Developed market banks and corporates will remain active issuers, with emerging market issuers, sovereigns and municipals, and green secularisations providing important engines of growth," it added.
Further, the report observed that China and India "will be the leaders among emerging markets".
"Growth in aggregate issuance will be supported primarily by China and India, which have accounted for a combined $53 billion of issuance since the inception of the green bond market," it said adding that issuances will increase in other emerging countries as governments look to implement green finance policies.
According to the Moody's findings, cumulative green bond issuance in India has more than doubled to $6.5 billion (in US dollar-equivalent terms) since the Securities and Exchange Board of India (Sebi), the country's capital markets regulator, issued its green bond regulations in May 2017.
Similarly, the report noted that such issuances by China rose exponentially to $22.9 billion in 2016, from $1.3 billion a year earlier, following the release of green bond guidelines from the Peoples Bank of China and the National Development and Reform Commission.
According to Moody's, despite a number of challenges green bond market for emerging regions are strong, underpinned by ambitious climate and sustainable policy agendas and multilateral support for market development.
The report noted that bulk of the issuance across the globe, in terms of volume, will be driven by issuers who have traditionally played a large role in the green bond market.