Simultaneous Industrialization and Decarbonization

While most developed nations were faced with the question of decarbonization long after industrialization, India’s multipronged approach aims to address industrializing and decarbonizing the nation simultaneously. India’s Aatmanirbhar vision coupled with the Hon’ble Prime Minister’s Panchamrit (or Five Elements) Climate Pledge are emblematic of India’s deep commitment to this alternate vision of growth.

This is an interdependent world where globalisation through land, the seas and technology, ensures that individuals and countries rely on each other on an everyday basis. India’s approach must be inward as well as external facing. The country’s economic future should strive to prioritise its people’s needs while ensuring that it becomes a voice for the Global South — leaving no one behind.

“India’s multipronged approach aims to address industrializing and decarbonizing the nation simultaneously. India’s Aatmanirbhar vision coupled with the Hon’ble Prime Minister’s Panchamrit (or Five Elements) Climate Pledge are emblematic of India’s deep commitment to this alternate vision of growth.”

When India took over the G20 presidency, it gained center stage among the 4.6 billion citizens of G20 member nations. India’s G20 presidency is a watershed moment in time as it provides an unparalleled opportunity to showcase to the world India’s cultural and business heritage and its true potential to become a defining force in the global economic order.

Fifth Now, Soon to be Third

The Indian economy continues to witness impressive growth. In the current fiscal year, the Government of India has also put special emphasis on building robust capital expenditure for building infrastructure that creates new jobs, promotes private consumption and further boosts the economy.

With a $122 billion outlay for building roads, highways, and first- and last-mile transport, the government aims to set the stage for a New India, well on its path to become a $5 trillion economy. India is currently the fifth largest economy in the world, soon to be the third largest after surpassing Japan.

• Real GDP Growth: Surpassed expectations when real GDP grew at 6.1% in Q4 FY23.
• IMF Outlook: The International Monetary Fund (IMF) in its World Economic Outlook (April 2023) projected India to grow at 5.9% in FY23, making it the fastest-growing major economy in the world.
• Growth Drivers & Structural Reforms: Pegged to grow at over 7% annually, propelled by IT, manufacturing, and agriculture, alongside landmark structural reforms: the Goods and Services Tax (GST), Real Estate Regulatory Authority (RERA) Act, and the Insolvency and Bankruptcy Code (IBC).
• Demographic Dividend: Having surpassed China in population, India is the world’s largest producer of human resources. By 2030, India will have over 1 billion citizens in the working-age group.

“With a $122 billion outlay for building roads, highways, and first- and last-mile transport, the government aims to set India the stage for a New India, well on its path to become a $5 trillion economy.”

India as the World’s Manufacturing and Export Hub

For a nation’s sustainable growth, exports need to move northside for a long period of time. In India we are witnessing an annual growth of 7 to 8 percent. Maintaining this trend over decades requires huge exports which would not only provide economies of scale but also help in correcting India’s balance of payments. Therefore, the idea behind introducing the Production Linked Incentive (PLI) scheme for manufacturers is to aim big. For a growing exports sector, it is imperative for MSMEs to work in tandem with large entities.

Every challenge presents a window of opportunity. When the world faced adversarial conditions, India rose to the challenge with people-centric solutions — emerging as a global supplier of COVID-19 vaccines during the pandemic. Sooner rather than later, India will become a global supplier of semiconductors. To counter global chip shortages that impacted the automotive sector, India has announced substantial central and state subsidies along with incentives to attract mega semiconductor fabrication ecosystems.

Green Growth & National Green Hydrogen Mission

Investments in India’s green energy sector are a major push for manufacturing aspirations with green growth:

• $800 Billion Green Investment Outlook: Bank of America estimates green investments in India will reach $800 billion over the next decade:
  • Renewable energy sector: ~$250 billion
  • Battery storage & grid infrastructure: ~$250 billion
  • Green hydrogen, electrolysers & equipment: ~$300 billion
• National Green Hydrogen Mission: Aims to transform India into a global export hub for green hydrogen and its derivatives. Leveraging climatic advantages, skilled talent, and policy support, India aims to reduce production costs from $4.5/kg down to $1/kg, while developing domestic manufacturing for modular electrolyser systems and balance of plant components.

“India’s recently announced National Green Hydrogen Mission, also aims to make India an export hub for green hydrogen and its derivatives.”

Agricultural Exports & The Nutri-Cereal Revolution (Millets)

India’s agricultural sector recorded its highest-ever exports of $50.21 billion in FY 2021-2022. This boom is supported by institutional initiatives:

• Farmer Connect Portal: Operated by APEDA to digitally connect farmers and aggregators directly with international exporters.
• One District One Product – District as Export Hub (ODOP-DEH): Identifying specialized products across all 765 districts to scale manufacturing and global export.
• The Superfood Transition: While India is a major exporter of water-intensive crops like rice, sugar, and wheat, there is massive potential to expand millets — India’s ancient, nutrient-dense, climate-resilient nutri-cereal that requires significantly less water, promoting sustainable agriculture while meeting surging global demand.

All Things Tech: Digital Public Infrastructure & Startups

India’s digital transformation is a cornerstone of its growth agenda. The large-scale digital intervention demonstrated by India is unmatched globally:

• Digital Public Infrastructure (DPI): Platforms including Aadhaar, DigiLocker, Jan Dhan Yojana, Air Suvidha, and CoWIN have empowered hundreds of millions, helping India leapfrog over forty years of development.
• Startup Capital of the World: Backed by the Startup India initiative and DPIIT recognition, entrepreneurs receive tax incentives, smoother compliance, and fast-track public procurement.
• Four Pillars of Future Growth: The next decades will be propelled by Technology, Artificial Intelligence (AI), Machine Learning (ML), and Data, engineering solutions for domestic citizens and global markets alike.

“India’s digital transformation is a major component of India’s agenda for growth.”

Inclusive, Sustainable & Women-Led Development

To make India’s growth trajectory truly inclusive, we must build gender-inclusive policies and business practices that encourage India’s women population to become equal participants and stakeholders in the economy. Women-led development is the only way forward if India wants to become a $5 trillion economy.

While India is carving a unique pathway to industrialization, it must also aim to build an alternate global supply chain base. Our resources strongly position us to lead this alternative supply chain over the next 10 to 30 years through strategic global partnerships and multilateral leadership.

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Author may be reached at: eboard@icai.in