In this insight, Joe Phelan (Director, WBCSD India) shares his thoughts about the year that just went past and the opportunities that will be available in the years to come in India and elsewhere. Businesses in India have a critical role to play in shaping these transformations to build India’s competitiveness and inclusivity. Companies that prioritize India’s sustainable development in their growth strategies stand to benefit in the coming decade.
Delhi, 22 December 202: Though the pandemic is still very much present, and as organizations and individuals we are gripped with the personal and economic impacts of the virus, the end of a year is always a good time for introspection and to think about the years ahead. And there are reasons to be optimistic.
COVID-19 has made us all aware how our ability to build consensus and act collectively has been undermined. It has also highlighted how the power that governments have through policy instruments, if they choose to deploy them, and of the speed at which businesses can respond and innovate. More than anything, the pandemic has shown us how interconnected, and interdependent, our economic, natural and social systems are.
As we look ahead to recovery and growth, it is clear that sustainable prosperity requires solutions for climate, nature, health and social equity that use a holistic, ‘systems’ approach.
The pandemic has had a deep impact on India’s economy, with the first quarter of the financial year reporting a 24% contraction of the economy. The pandemic highlighted and exacerbated the severity of issues in the health infrastructure, housing, labor, transportation, infrastructure, social security and inequality in the country. The lockdown caused immediate, large-scale job losses, migration and hunger, affecting almost 40 million people.
The government’s policy focus for the post-COVID-19 recovery has been on structural reforms to agricultural, business and labor laws, in the hope of attracting greater investment. These will need to be supported by strong climate action and oriented towards achieving the Sustainable Development Goals (SDGs). Home to one-sixth of the world’s population and set to be the world’s populous country by 2030, India will play a leading role in determining the relative success or failure of the SDGs.
With the current crisis there is an opportunity to support India in using the recovery to more quickly transition its energy, mobility and food systems. This would mean more electric vehicles, a transition from coal, promoting sustainable, resilient agriculture and providing employment – especially for the burgeoning youth population.
This December has marked the fifth anniversary of the adoption of the Paris Agreement, a reminder that the world is able to come together and agree collective, radical action to meet global challenges. Today, India is the only G20 nation with policies in place to be “2°C compatible” and its climate commitment in 2030 is within the range of what is considered to “be a fair share of global effort”.
India has made dramatic progress on renewables and energy efficiency. There is significant leadership from the private sector too. While at the at the Climate Action Summit 2020, India’s Prime Minister, Narendra Modi, claimed that “India will exceed the Paris Agreement targets”. But India is the only large emitter globally without a date set for net zero. Heavy industries and emissions from agriculture are the next challenges for India to meet, while keeping the country growing domestically and competitive internationally.
India is central to the world’s efforts to limit global warming to 1.5 degrees. It cannot complete its transition in time without the right financial instruments in place. The 26th Conference of the Parties to the UN Framework Convention on Climate Change (COP26 for short) in the United Kingdom next year is a major opportunity for India to buid on its progress in clean and affordable energy, and to broaden this out into an economy wide transition. The key focus should be on finance, particularly clean energy access, resilient infrastructure, and natural climate solutions.
Businesses of the future
As WBCSD’s CEO, Peter Bakker writes, the responsibility for radical action is also on business: all companies need to progress their climate action significantly to stay on track to achieve the Paris Agreement goals.
It is heartening to see businesses across the world, and in India, playing their part to decarbonize their operations, putting in measures to build business resilience, and pushing for a green recovery. Business leaders increasingly recognize that transitioning to a low-carbon economy is not only important to mitigate climate change but is also good for the future of their businesses. The large number of businesses committing to the Science-based Targets Initiative, TCFD, or the acceptance of WBCSD’s new membership criteria by a strong majority of our members prove that businesses are preparing for the challenges looming ahead and working towards building a sustainable future – to create a world in which all 9+ billion people can live well within the boundaries of our planet.
Businesses in India have a critical role to play in shaping these transformations to build India’s competitiveness and inclusivity. Companies that prioritize India’s sustainable development in their growth strategies stand to benefit in the coming decade.
Ambitions to actions
Though the world is not on track on bending the curve on emissions there is still a lot be optimistic about. Going forward, our focus should be on converting climate ambitions into concrete actions and setting the course for the future. The upcoming COP 26 will be about implementation- and if this is to be meaningful then India will be placed at the heart of this agenda. It’s time for us to move beyond ambitions and make net-zero a reality in the coming decade. Let us keep the spirit of collaboration active and leverage the COP 26 to drive renewed ambitions with governments, businesses and civil society to deliver sustainable prosperity for all.