By Abhay Ray 
Introduction
Over the next decade, India is poised to double the size of its economy, a trend that is likely to persist for subsequent decades. While this rapid economic growth is an opportunity for the nation, it also poses a significant challenge: doubling emissions. While India contributes a fraction of global historical emissions and per capita emissions, the reality is that our poor, health infrastructure, and food systems will be unable to cope with the inevitable climate shocks if this growth leads to unsustainable emissions. However, there is a way to decouple economic growth from emissions: through climate innovation, particularly in the realm of technology.
India already has many of the foundational building blocks necessary to become a global hotspot for climate tech innovation. These include a burgeoning entrepreneurial spirit, a thriving startup ecosystem, a frugal engineering mindset, and a relentless focus on delivering scale. We’ve seen this before whether in bringing banking to millions of people or executing cost-effective space missions to the Moon and Mars. Now, it’s time to direct this potent force towards climate action.
India’s Climate Tech Success Stories
Encouragingly, there are several examples of climate innovation already taking root in India. The Indian cement sector, for instance, is now considered one of the greenest in the world. Some of the top cement companies in the country use fly ash a waste product from thermal power plants to make up 80% of their raw material. This innovation has helped significantly reduce carbon emissions in a traditionally emissions-intensive industry.
In the electric vehicle (EV) sector, India is becoming a global leader. In 2024, around 1.6 million electric vehicles were sold, primarily consisting of electric scooters and electric three-wheelers. This shift in transportation represents a key opportunity for India to reduce emissions in one of the most polluting sectors, while also supporting the growth of an entire ecosystem focused on clean mobility. In addition to EVs, energy-efficient light bulbs and ceiling fans have become a major business segment in India, contributing to both environmental sustainability and economic growth.
These examples show that when India applies its engineering ingenuity and entrepreneurial spirit to climate challenges, it can emerge as a leader in climate tech. But there’s still much more to be done. The challenge is to scale these innovations and spread them across sectors, regions, and industries.
The Agricultural Value Chain – Harnessing Digital Transformation
One area where India has significant untapped potential is in the agricultural value chain, which remains dominated by small-scale production rather than mass production. Agriculture employs nearly half of India’s workforce, and yet it lags in the adoption of digital technologies that could drive productivity and sustainability.
The introduction of initiatives like AgriStack—the agricultural counterpart to IndiaStack, EdStack, and HealthStack—holds promise. AgriStack aims to digitally empower farmers by enabling data-driven solutions across multiple facets of agriculture. Key areas where technology could have a profound impact include soil health, livestock productivity, farmer advisory services, and groundwater management. By leveraging data science, these solutions could improve yields, reduce environmental impacts, and boost income for millions of farmers, contributing to both economic value and public good.
The Key to Scaling Up Innovation
Despite the exciting potential, one of the key barriers that innovators face in India is a lack of interoperability. For many innovations to scale effectively, they must be able to work seamlessly with other systems and technologies. Without a framework for standardization and interoperability, companies are forced to build infrastructure from scratch, leading to inefficiencies and slow progress.
India can look to the success of the Unified Payments Interface (UPI) as a model for addressing this issue. UPI revolutionized digital payments by creating a unified, interoperable platform that allowed multiple players to participate in a seamless digital payments ecosystem. A similar model could be adopted in climate tech, particularly in areas like charging infrastructure, energy generation, and more. Initiatives like the Beckn Protocol, which builds decentralized and open protocols for interoperability, can be instrumental in ensuring that climate innovations can be scaled quickly and efficiently.
A Crucial Pillar of Climate Innovation
While the transition to renewable energy is crucial for India’s climate goals, it’s important to recognize that renewables alone won’t be sufficient. The country still has a large stock of fossil fuel-based machinery, and to meet its ambitious climate targets, India will need to extract more output per unit of fuel. This means that energy and resource efficiency must be prioritized, even in the fossil fuel-based infrastructure that remains.
Engineering talent will play a critical role in this transition, finding ways to improve the efficiency of existing systems while also investing in green technologies. Moreover, energy efficiency is not only a matter of reducing carbon footprints but also of improving the profitability of businesses. Energy-efficient technologies offer both environmental and economic benefits, making them a central piece of India’s climate innovation strategy.
The Need for Increased Investment in R&D
One of the biggest hurdles India faces in scaling climate innovation is a lack of investment in research and development (R&D). India spends just 0.6% of its GDP on R&D, a stark contrast to the 1.6% spent by other industrialized nations. Furthermore, only 40% of India’s R&D spending comes from the private sector, compared to 70% in other countries. To position itself as a leader in climate innovation, India must significantly increase its R&D investments, particularly in green technologies.
The government can play a key role in incentivizing this shift by introducing green-focused initiatives. One potential solution is to introduce a green angle to the Production Linked Incentives (PLI) scheme, providing additional incentives for industries that adopt greener processes. A Research Linked Incentive (RLI) could also be introduced to encourage corporate R&D spending and foster deeper collaboration between industry and academia.
Conclusion
Climate change is undoubtedly one of the most significant challenges of our time. But it also represents one of the greatest business opportunities of the century. India, with its immense engineering talent, innovative spirit, and scale, is in a prime position to lead the way in climate innovation. By focusing on technological advancements in sectors like agriculture, energy, and manufacturing, India can not only contribute to global climate goals but also create sustainable economic growth. The time to act is now, and India’s engineering prowess can help deliver solutions for the planet—one innovation at a time.
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