Why Acting on Climate Change Is Good Strategy for India

As PM Modi sets out to visit the US for his first meeting with President Trump, the approach of the two leaders on climate change cannot be more different. President Trump has ceded leadership on the issue by pulling the US out of the Paris Agreement earlier this month. PM Modi on the other hand, has charted a new path for India to assume a global leadership position on climate.


Any speculation of India back tracking on its Paris commitments after the US pulled out were quickly dispelled, as New Delhi moved to assure the world that India will continue to work towards implementing its climate targets. PM Modi has further reaffirmed this position over the past few weeks in meetings with Canadian PM Trudeau, French President Macron and German Chancellor Merkel.


India’s leadership recognizes that acting on climate change is good for its citizens and in its own strategic interests. Here are several reasons why taking climate action and investing in clean energy is a good strategy for India:


  • Good Economics: Solar prices in India are dropping at a rapid clip, with yet another record-low being reached in May 2017 of INR 2.44/kWh (3.8 cents/kWh). Plummeting costs make a persuasive case to bolster investments in the sector to tackle three key challenges for India’s power sector—affordability, security and access. India has also put in place an ambitious target to sell only electric vehicles beyond 2030—this is expected to massively reduce India’s dependence on imported oil. This will help reduce India’s current account deficit, which is expected to touch $30 billion by 2018 owing to, in a large part, import of enormous volumes of crude oil.
  • Creating Jobs: With a median age of 27.6 years, India is one of the youngest countries in the world. Employment generation is a big priority for the government, and the economy. Our recent analysis reveals that more than 300,000 new jobs can be created over the next five years in the Indian renewable energy sector. Recognizing the scale of opportunity, the Indian government has established a dedicated institution, the Skill Council for Green Jobs, to develop a trained and skilled workforce to meet the growing needs of the renewable energy sector.  
  • Reinforcing Climate Leadership: Continuing the renewables revolution already underway in the country (building 175 Gigawatt of renewable energy capacity by 2022) will help propel India further towards global climate leadership. Also, by taking initiatives like the International Solar Alliance (ISA), which seeks to foster cooperation between solar-rich countries to drive down cost of finance and technology, and spur innovation, India is looking to further cement its position as a leader in clean energy.
  • Air Pollution and Liveability: Air pollution a serious menace in most major Indian cities. It not only affects people’s health, but can also weaken competitiveness of Indian cities in a globalized economy. Bolstering clean energy and energy efficiency will help address this issue and ensure reduction in emissions of harmful pollutants to make Indian cities more liveable.
  • Insurance Against Future Climate Impacts: India is highly vulnerable to climate impacts. Unprecedented floods in Chennai, Uttarakhand and Jammu & Kashmir, droughts across much of the Western India, and severe heat wave spells across the country over the past few years have shown how extreme weather can significantly impact communities and undermine development. Taking action now to implement the Paris agreement is basically an insurance for India against severe climate impacts over the long term.


It is not difficult to see why India continues its energy transition at home, while also pushing for the rest of the world to deliver on their Paris pledges. Led by PM Modi, India is well and truly on its way to fill the leadership vacuum created by the US pulling out of the Paris Agreement.   


Co-authored with Sayantan Sarkar 

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