The efforts by Prime Minister Narendra Modi’s government to prepare a business continuity plan to counter the economic impact of the Covid19 pandemic on a “war footing” signals its commitment to respond proactively to the challenges that lie ahead. Rajiv Kumar, vice-chairman of NITI Aayog, has already said that India’s GDP growth could fall to zero or even negative in the first quarter of the current financial year because of the pandemic. Barclays Research has also revised its growth estimates for India to zero in the current calendar year from its previous revised estimate of 2.5 percent.
However, even before the Covid19 crisis hit, India’s economy was facing a “great slowdown” owing to low industrial activity and stagnant investments. For FY 2019-20, the economy was set to grow at 5 percent—its slowest in 11 years. A major reason for this slowdown in growth is the impact of climate change and global warming. A Stanford University study published in Proceedings of the National Academy of Sciences highlights that India’s economy is already 31 percent smaller than it would have been without climate change.
As India prepares to revive its economy in the aftermath of the pandemic, two critical questions must be answered to help determine its development future. Should India continue with the same development model and lock in years of inefficient, high-carbon and unsustainable development? Or should India use the current disruption as an opportunity to accelerate the inevitable and urgently-required shift to a low-carbon, resilient, regenerative economy, and create a new development template for the world to adopt?
Should India use the current disruption as an opportunity to accelerate the inevitable and urgently-required shift to a low-carbon, resilient, regenerative economy, and create a new development template for the world to adopt?
Covid19 is a harsh reminder of the devastating impacts of shocks to the under-prepared systems. Scientists have already established the effects of global warming and increasing intense climate-induced disasters on India’s development. An International Labour Organisation (ILO) report projected that India could lose 5.8 percent of working hours in 2030 due to increased temperatures, a productivity loss equivalent to 34 million full-time jobs. In the event of a temperature rise of 2° C by 2050, India will have to import more than twice the food grain it would have otherwise required. According to the World Bank, India’s inability to act on climate change could shave US$1.12 trillion off the country’s GDP by 2050.
Covid19 is a harsh reminder of the devastating impacts of shocks to the under-prepared systems. Scientists have already established the effects of global warming and increasing intense climate-induced disasters on India’s development
Moreover, the WHO has identified the rise in temperature and future climate change as a major cause of emerging infectious diseases and spread of antimicrobial resistance, which could raise the risk of future epidemics and consequently increase the pressure on critical infrastructures like public health in developing countries. India is among the most vulnerable countries as the impact of such a crisis is likely to reverse its hard-won development gains and hamper progress towards achieving its Sustainable Development Goals.
For a county that aims to grow into a US$5 trillion economy by 2024, climate proofing its economy and building resilient development sectors is therefore not an option but a priority for India. The nature of the crisis calls for a policy and investment response that addresses three inextricably linked dimensions of sustainable development—economic, social and environmental. A greater focus on green energy transition, building resilient infrastructure and climate-smart agriculture as part of the borader recovery will help achieve energy and food security, and foster long-term economic development while promoting equity, employment, welfare and resilience.
For a county that aims to grow into a US$5 trillion economy by 2024, climate proofing its economy and building resilient development sectors is therefore not an option but a priority for India
Energy access is critical to crisis response. Access to sustainable electricity, such as during this pandemic, is necessary to communicate with public services and ensure that medical equipment and medicines are fully functional. In countries like India where universal energy access remains a challenge, speed of deployment of solutions such as renewable energy—which offers self-sufficient, sustainable, reliable and affordable access—is vital. India is already transitioning to green energy, with an ambitious renewable energy expansion target of achieving 175GW capacity by 2022. In the power sector, renewables have made new capacity additions, accounting for 35 percent of India’s installed electricity generation capacity. And renewables are expected to meet about 21 percent of India’s total electricity demand in 2021-22.
However, India depends on China for about 80 percent of the components used in the production of solar energy. Disruptions and delays in the supply chain due to the Covid19 pandemic is expected to impact the project timelines and subsequent energy transition targets.
India’s share of global energy demand is estimated to double by 2040, with fossil fuels sources such as coal likely to meet just half of the increased demand. As an energy-deficient country that must secure the access to energy of the world’s fastest-growing population, India cannot afford long term delays in renewable energy production. As a promising market of the global solar industry, India should leverage its Make in India programme and seize this opportunity to create an alternative destination for solar cell, module and inverter manufacturing. Increasing no-carbon, reliable, uninterrupted and sufficient energy production should be core to the preparation for a more sustainable economic recovery. However, substituting for imports would require India to first create a consistent solar manufacturing strategy and provide incentives to make the sector attractive for domestic investments.
In rural India, where about 31 million homes still lack access to electricity, decentralised renewable energy (DRE) solutions, such as solar lighting systems and micro-grids, are also significant opportunities. As DRE solutions are comparatively labour-intensive, their adoption can create local employment as well as business opportunities through utility renewable markets and solar rooftops. The sector has already created 47,000 new jobs and employment for 432,000 people in 2017, as per an IndiaSpend report. The International Labour Organisation estimates that India’s shift to a green economy could add 3 million jobs by 2030 in the renewable energy sector alone.
The creation of infrastructure, investments and strategies to scale up renewable energy, such as the installation of power grids, electric vehicle charging systems and energy storage, would accelerate low carbon development and present new long-term economic opportunities. However, besides infrastructure that aids low-carbon development, it is essential to focus on creating or retrofitting the existing public infrastructure to make them climate resilient.
Covid19 has highlighted the importance of infrastructure in facilitating the smooth provision of transport, connectivity and essential services. In India, ill-equipped and insufficient public health centres, shortfalls in water and sanitation, poorly housed localities, and a lack of energy access are causing grave concern over the eventual scale and impact of the pandemic. Critical infrastructure in many regions of the country already far from adequate. At the same time, they are exposed to increased risk from climate-induced disasters.
According to the National Disaster Management Authority, around 40 million hectares of India’s land area is exposed to floods; 68 percent is vulnerable to droughts, landslides and avalanches; and 5,700 km of the 7,516-km long coastal line is exposed to tsunamis and cyclones. India has recently seen the impact of Cyclone Fani and recurrent floods on its infrastructure in Orissa and Kerala. While the post-disaster assessment of the two states shows that it will take them about ten years to build back the critical infrastructure (connectivity and communication networks, hospitals and transport systems), their shortage is a huge risk and limitation to response capacity, especially during times of uncertainty, such as currently with the Covid19 pandemic.
Moreover, frequent disasters increase the fiscal pressure on the Centre and state governments to make up for the loss and damage. Therefore, investing in creating robust, well-resourced and resilient infrastructure, and retrofitting the existing ones should be part of the government’s recovery plan. Investing in resilient infrastructure over the next decade in developing countries would see a net benefit US$4.2 trillion over the lifetime of that infrastructure, with a US$4 benefit per US$1 invested.
Investing in resilient infrastructure over the next decade in developing countries would see a net benefit US$4.2 trillion over the lifetime of that infrastructure, with a US$4 benefit per US$1 invested.
With Covid19 causing runs on local food markets worldwide, and people seek to ensure the health and well-being of the family, food security has never seemed more critical. However, India’s agriculture sector, which employs half of India’s total workforce, is reeling from severe distress. A threefold rise in rainfall events and increased droughts, primarily due to climate change, have reduced crop yields and caused about US$9-10 billion in damage per year to the agricultural industry alone.
Making India’s agriculture system climate-resilient should be of extreme importance in the broader recovery plan. Employing CSA technologies, practices and services would ensure stability and sustainability in agricultural production, and enhance output, yield and return. Scaling up zero budget natural farming as a climate-resilient farming system can improve food and nutritional security, protect the ecosystem, and reduce environmental pollution.
Research and innovation are vital to keep improving the technologies and reduce the costs of transitioning to a green economy. With the global economy expected to take a severe hit due to the pandemic, the transfer of finance and technologies from developed countries to aid the transition of developing nations will be deeply impacted.
The Covid19 crisis should motivate countries to adopt forward-looking policies to act faster on decarbonisation and adaptation since the incidence of diseases is likely to rise with climate change. The long-term solution to global development challenges will be scientific and technological. So, while climate change research is expected to witness setbacks the world over in the form of funding cuts, project delays and cancelled climate conferences, it is in India’s interest to invest in research and innovations and pursue effective solutions to the greater development challenges.
This year was meant to be a turning point for climate and sustainable development, marking the start of the decade of action. The unexpected pandemichas interrupted strong actions with the delay of critical biodiversity and CoP26 summits. As one of the leaders in climate governance and an influential member of several world forums such as the G-77, BRICS and G-20, India has an opportunity to push for a new economic development model premised on low carbon emissions, climate resilience, and sustainable and inclusive pathways, and seek international co-operation in addressing the deeply embedded vulnerabilities of economies to future risks.
The economic decline due to the Covid19 crisis presents India with a rare glimpse of the magnitude of transformations required in the coming decade to deal with the other looming threat—climate change. India should seize this opportunity to present the world a shining example of how stronger climate actions could be successfully aligned with development imperatives.
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Aparna Roy is a Fellow and Lead Climate Change and Energy at the Centre for New Economic Diplomacy (CNED). Aparna's primary research focus is on ...
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