One of the breakthrough pledges at last year’s COP26 summit came from India’s Prime Minister Narendra Modi, who pledged to cut emissions to net zero by 2070. But, unlike the more developed nations that have set out 2050 net zero ambitions, India is still in a growth stage. It faces a fine balancing act to meet increasing power supply demands and raise a significant proportion of its population out of poverty while reducing emissions.
Climate risk and India
India: CO2 Emissions in a Global Context
Annual CO2 emissions (billion tonnes)
India accounted for 7% of the world’s CO2 emissions in 2019, up 40% from 2009 levels indicating the rapid development of the country.
Per capita emissions (billion tonnes)
GHG emissions by source (million tonnes)
Total primary energy demand in India, 2000-2020
India is heavily reliant on coal and other fossil fuels for its energy needs. Traditional use of biomass such as wood or charcoal has been falling but an estimated 50% of people still do not have access to clean cooking facilities.
Economic growth verses emissions reductions
Installed solar capacity (GW)
India’s climate policy
- increase its renewable-energy capacity to 500GW
- meet 50% of energy demand from renewable energy sources
- reduce the economy’s carbon emissions intensity by 45%
- reduce its total projected carbon emissions by 1 billion tonnes
India’s 2021 budget announcement was also more climate-friendly, with two-thirds of the USD120bn earmarked for energy heading towards renewable energy. However, one of the biggest disappointments at COP26 was the watering down of the coal power commitment led by India and backed by China from “phase out” to “phase down”.
We believe a key priority for India is to provide additional details around their net zero targets. The additional detail is needed to properly evaluate their plans, and for companies to understand the role they are expected to have and the associated commercial risks and opportunities. India has a key role in achieving global carbon reduction targets and Modi’s commitments at last year’s COP26 marked a visible shift in the way India views its role in the global climate action. Modi also stressed that developed countries will need to make climate finance available to developing countries. Given that India has only contributed to 3.2% share of global CO2 since 1750 (verses 4.6% contribution from the 20 times smaller, by population, UK) perhaps he has a point.