India's Path to Net Zero, Challenges and Potential Benefits

India’s Path to Net Zero, Challenges and Potential Benefits

Discover India's path to Net Zero, focusing on renewable energy, carbon reduction strategies, and sustainable policies aimed at achieving climate neutrality by 2070.

Table of Contents

Context: Much needs to be achieved in India in the near term to reach that net zero emission goal.

India’s Path to Net Zero: Challenges in Balancing Fast and Green Growth

High Dependence on Carbon-Intensive Activities: Coal accounts for 55–60% of India’s power generation.
- Demand for coal is expected to peak only between 2030 and 2035.
Economic Costs of Climate Risks: Climate-related risks could cause a loss of 8% of GDP by 2030.
- Extreme heat could reduce GDP by 5%–4.5% by 2030 and up to 10% by 2050.
- Lost labour productivity due to extreme heat could cost $220 billion by 2030.
- Carbon cost penalties imposed by importers of Indian goods could lead to $150 billion in lost export revenues annually by 2040 if industries are not decarbonised.
- Dependence on imported fossil fuels (85% of crude oil and 50% of natural gas) exposes the economy to price volatility and geopolitical risks.

Fact

Net-Zero Target: India aims to reach net-zero emissions by 2070.
Key 2030 Targets:
- 50% reduction in emissions intensity.
- 500 GW of fuel capacity from renewable sources.
- US $290 billion in investments in new wind and solar energy sources.

Union Budget 2025 – Key Green Initiatives

100 GW of nuclear capacity by 2047.
Support for:
- Solar equipment manufacturing.
- Grid-scale batteries.
- Incentives for scrap materials and critical mineral recycling.

Potential Benefits of Green Growth

Job Creation: Green growth could create 50 million new jobs in India by 2070 (World Economic Forum’s Mission 2070 report).
- Could generate $1 trillion in additional economic value by 2030 and up to $15 trillion by 2070.
Innovation and Manufacturing: Promotes manufacturing and technological innovation with spillover effects on productivity and growth.
Health Benefits: Improves health, which enhances productivity and economic output.
Energy Security: Strengthens India’s resilience to global shocks and geopolitical pressures.

Strategies for Holistic Green Growth

Comprehensive Renewables Plan

Combine investments in renewable capacity with climate adaptation.
Develop supportive infrastructure:
- Transmission and storage systems.
- Public-private collaborations.
- Carbon capture and storage.

Demand-Side Measures

Farmers (45% of the workforce) need access to:

Affordable climate-resilient infrastructure.
Drought-resistant crops and farming practices.
MSMEs (contribute 30% of GDP) need access to:
- Sustainable technologies.
- Green finance.
- Education and subsidies.
Tools like carbon pricing and green finance schemes could be expanded.

Managing Transition Risks

Support coal-dependent states by:

Reskilling workers.
Rebuilding economies.
Cross-subsidisation from states benefiting from green transition.

Global Partnerships and Collaboration

Collaboration with international players can enhance:

Technical expertise.
Project management.
Innovative financing (e.g., green bonds, blended finance).
Multilateral development banks could offer guarantees to encourage private sector participation.

Conclusion

A holistic and strategic approach to green growth is essential for India to achieve both its Viksit Bharat (2047) and Net-Zero (2070) goals.
Balancing fast growth with green growth requires:
- Strong infrastructure and technology investments.
- Policy reforms.
- Global collaboration.
- Strategic adaptation to economic disruptions.