The Indian government’s commitment to pursuing low-carbon development is evident in its ambitious targets and path-breaking climate initiatives
This piece is part of the series, India@75: Aspirations, Ambitions, and Approaches
Conventional development models—driven primarily by unbridled industrialisation and rapid urbanisation—are no longer suitable for the country’s economy.The onset of the Fourth Industrial Revolution presents a tremendous opportunity for India to couple its economic and environmental goals, which will transform the fundamental contours of the economy. Green technologies and business models are set to unleash an unprecedented wave of disruption, propelling the Indian economy towards the Green Frontier. In the last few years, there has been a swift expansion of the green energy and technology ecosystem in India—spread across wind and solar power generation firms, biofuel production, and electric vehicle manufacturing. What was once an aspiration has become a reality, as countries around the world are beginning to recognise India as an attractive destination for renewable energy investment and are making substantial investments in India’s green energy system. Indeed, the Indian renewable energy industry has rapidly increased its capacity, at an annual growth rate of 17.5 percent between 2014 and 2019, and increased the share of renewables in India's total energy mix from six percent to 10 percent. This growth was accompanied by a sharp increase in investment in the sector, from both domestic and foreign players. Since 2014, the sector has received investments worth more than US $42 billion, and around US$7 billion in foreign direct investment (FDI) between April 2000 and June 2018. To be sure, substantial potential remains untapped in the green economy. Global experience suggests that long-term economic growth in the 21st century can only be sustained if policymakers effectively leverage the linkages between technological innovation and green growth. This can be accomplished by focusing on two key policy levers: Market creation and the mobilisation of green finance. As shown by international best practices, the green economic transformation of any region must be a market-driven process, for which policymakers must unleash market forces to incentivise investments for building a low-carbon economy. It is also imperative to dovetail the financial sector with the national climate policy, to develop sufficient financing capacity from private as well as public sources. At the same time, to catalyse any economy’s green transformation, a conducive regulatory environment for green innovation is a necessary condition. Another crucial policy lever is the creation of an effective institutional architecture to support green growth, the pillars of which would include legislative bodies, independent monitoring organisations, dedicated funding agencies, academic institutions with major climate change research programmes, and intersectoral expert groups.
The Indian renewable energy industry has rapidly increased its capacity, at an annual growth rate of 17.5 percent between 2014 and 2019, and increased the share of renewables in India's total energy mix from six percent to 10 percent.The Indian government’s commitment to pursuing low-carbon development is evident in its ambitious targets and path-breaking climate initiatives. The recently concluded COP26 marks a momentous moment for India, with Prime Minister Narendra Modi declaring a Net Zero target for 2070 and propelling the levers of development towards more green and sustainable pathways. The country has declared to increase its non-fossil energy capacity to 500 GW, bring its economy's carbon intensity down to 45 per cent, and reduce 1 billion tonnes of carbon emissions from the total projected emissions—all by 2030. The capacity target for renewables has been increased from 175 GW to 228 GW by 2022, further committing to fulfil 50 per cent of its energy requirement through renewable energy by 2030. By launching the International Solar Alliance (ISA) in 2015 and the Coalition for Disaster Resilient Infrastructure (CDRI) in 2019 and, most recently, the Infrastructure for Resilient Island States (IRIS) in 2021, India has successfully positioned itself as an emerging leader in the domain of climate action. The Smart Cities Mission (2015), National Clean Air Programme (2019) and Jal Jeevan Mission (2019) are important examples of frameworks that embed the principle of sustainability in the domains of urban development, air quality and water management, respectively. Schemes such as the Ujjwala Yojana and the Rural Electrification Programme, too, are driving green technologies across the country.
Massive green investments will lead to fast economic growth, lower energy imports, higher job creation, rise in investment levels, and more lives saved from air pollution.The next decade will be decisive in establishing India’s development pathway and with the right policies for renewables, electric, mobility, carbon trading systems and carbon taxes, better outcomes can be achieved not only across environmental but also economic indicators. Massive green investments will lead to fast economic growth, lower energy imports, higher job creation, rise in investment levels, and more lives saved from air pollution. Careful planning must be undertaken to ensure the transition is just, fair and inclusive. Climate change is a global challenge that implicates everyone and requires coordinated, multi-stakeholder action. India’s low-carbon growth pathway can provide a new and unique model for the rest of the developing world. As the third-largest greenhouse gas emitter, the country’s climate action will play a crucial role in bolstering global efforts to combat the crisis. Thus, India’s green transformation is critical not only to the Indian growth story but also to global sustainability.
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