India is under diplomatic pressure to commit to a net-zero climate target ahead of the 26th UN Climate Change Conference of the Parties (COP26) meeting in Glasgow in November, but the country has pushed back on tougher targets and asserted the developing world’s right to economic growth.

Its refusal to set a net-zero target is at odds with other major Asian economies. In October 2020, China committed to achieve net-zero emissions by 2060, shortly after Japan’s 2050 pledge. Now Indonesia is targeting for 2060.

With India the world’s third largest emitter of CO2 behind China and the US, its administration was expected to make a strong, positive statement at the July 22-23 G20 summit in Naples.

This it did -- restating its determination to stick to existing commitments under the 2015 Paris Agreement -- while highlighting the disparity between developed countries’ emissions and those of emerging economies.

“We should not be shifting goalposts and setting new benchmarks for global climate ambition,” Indian Minister of Environment, Forest and Climate Change Bhupender Yadav said July 23 following the summit.

Instead, developed countries should be doing more to ensure the developing world had the “carbon space” to grow.

“Keeping in view of the legitimate need of the developing countries to grow, we urge the G20 countries to commit to bringing down per capita emission to global average by 2030,” a ministry statement said.

India has a strong case to argue when it comes to per capita emissions. According to S&P Global Platts Atlas of Energy Transition, India's per capita CO2 emissions was 1.66 mt in 2019, compared with 15.55 mt for the US, 16.56 mt in Australia and 8.11 mt in Germany.

A diplomatic faceoff is clearly brewing, with the G20’s official Naples communique unable to agree much more than “to update or communicate ambitious Nationally Determined Contributions (NDCs) by COP26.”

Delivering on NDCs

Under its existing NDCs, India has committed to 40% installed generation capacity from non-fossil fuels by 2030 and to reduce emissions intensity by 33%-35% by 2030 from 2005 levels.

India is on track to achieve this with renewable energy capacity, including hydropower, standing at 143.28 GW, or 37% of India’s total installed capacity of 384.12 GW.

Further, India has already achieved carbon emission reductions of 28% on 2005 levels, according to the Power Ministry.

A voluntary 2030 target of 450 GW of renewable capacity, meanwhile, is seen as a stretch but one that could be met with the help of large industrial sector investments by parties seeking to reduce their carbon footprint.

Other recent steps include a vehicle scrappage policy to promote fuel efficient vehicles, electric vehicle subsidies, incentives for renewable component manufacturing and for solar rooftop installations.

A hydrogen policy placing a purchase obligation on consuming sectors is awaited.

India’s climate policy was “development centric,” according to Kaushik Bandyopadhyay, chairperson, Centre for Business Sustainability at Indian Institute of Management in Lucknow.

“Mitigation and adaptation actions are not only intended to serve the cause of emission reduction, but also to provide development co-benefits,” he said.

Missing milestones

What is missing is an emissions reduction policy, one that builds political consensus despite regional differences, according to another policy expert.

“The government would have to identify the big polluters and mandate them to reduce emissions … it would need deadlines and milestones,” said G Chandrashekhar, a policy commentator and commodities columnist. “This is going to be a tough call -- it needs enormous political will to achieve it.”

A formal carbon market would help send a consistent price signal to polluters, but talks are yet to produce any material proposal.

Meanwhile, India continues to push for developed countries to follow up on a pledge to provide $100 billion/year for developing economies to help in decarbonization efforts through to 2025. That commitment was “reaffirmed” in the Naples communique.

“It is the big elephant in the room,” said Aarti Khosla, director, Climate Trends. “I am not sure if a serious finance package will be delivered. Any outcomes here might only be symbolic than real.”

Coal-fired emissions growth

About 70% of India’s energy needs are met by the combustion of coal. This share may fall in future but the fossil fuel is set to remain the dominant source of power demand growth, and this would rise by 4.4% from 2020 through to 2030, according to Roman Kramarchuk, S&P Global Platts Analytics head of Future Energy Analytics.

“Our Platts Analytics Global Integrated Energy Model estimates that India is accounting for 7% of total global energy combustion CO2 emissions in 2021 and we project that, under a most likely scenario, emissions will grow faster than the rest of the world,” Kramarchuk said.

“India’s most likely case: emissions in 2040 would account for 15% of our estimated 2 Degrees global 2040 combustion CO2 emissions,” he said.