The Aakhya Weekly #40 | Fading Dreams of 1.5C
The Aakhya Weekly #40 | Fading Dreams of 1.5C
In Focus: The Climate Crisis and India’s Resolve
The world is already 1.1C warmer, on average, compared to pre-industrial levels, and even our plans to combat climate change, let alone their implementation, are insufficient to keep limit warming below 1.5C, reveals the Intergovernmental Panel on Climate Change’s (IPCC) Sixth Assessment Report (AR6) and its accompanying Synthesis Report (SYR), released on 20th March, painting a bleak picture of humanity’s fight against climate change.
Since its inception in 1988, the IPCC has had five assessment cycles and has delivered five Assessment Reports, which are widely considered to be the most comprehensive scientific reports about climate change produced globally.
The SYR, a summary of the nearly 8,000 pages of the AR6, showcases the state of knowledge of climate change, its widespread impact and risks, and climate change mitigation and adaptation efforts. It integrates the main findings of the AR6, based on contributions from the three major working groups of the IPCC and three special reports published since the release of AR5 in 2014.
The IPCC, it seems, has gradually resigned itself to the fact that even best-case-scenario mitigation efforts will not be enough to counter the prevailing trend of increasing emissions. Comparing the AR6 to the AR5, we find hints about how climate science has changed over the past eight years, and become more reflective of the goals and aspirations of today. While the number of mentions of “mitigation” and “adaptation” were roughly the same in AR5, “adaptation” is mentioned almost 40% more than mitigation in AR6. In addition, after normalising values by number of pages, mentions of “equity/equitable” are more than 3 times higher in the AR6 than AR5. Perhaps most surprisingly, there are zero mentions of the term “net zero” in AR5, compared to 48 instances in the AR6.
Despite being the world’s third largest emitter, India’s narrative for responding to the climate change concerns is clear - reaffirm India’s tiny contribution to global cumulative emissions and comparatively miniscule present day per capita emissions, chastise developed nations for not fulfilling their capital commitments (or rather, promises), and make no qualms about putting development front and centre.
Here are some direct quotes from the Ministry of New and Renewable Energy in response to the release of the AR6:
“IPCC AR6 Synthesis Report scientifically re-enforces India’s position on the historical responsibility of developed countries for usurping the Carbon Budget and excessive emissions.”
“The Synthesis Report confirms once again that India, despite being home to more than 17% of the global population, has contributed less than 4% of the global cumulative CO2 emissions.”
“The Report confirms that financial support from developed to developing countries is a critical enabler of climate action highlighting that current flows are inadequate. This includes the promised-but-never-received USD 100 billion.”
“The report re-emphasizes India’s consistently held position that development is our first defense against climate change and that urgent and rapid climate actions are needed by the developed countries based on the principles of climate justice and equity,...”
This is not to say that India is not focusing on climate change mitigation efforts. With plans for 500 GW of renewable capacity by 2030, and the recently announced $2.9 billion USD national green hydrogen mission, India now boasts of one of the most ambitious renewable energy plans in the world. However, if the recent past is any indication, delivery on these plans is not certain. Case in point: India missed its target of building 175 GW of renewable capacity by 2022 by close to 55 GW, largely due to its abject failure in galvanising rooftop solar deployment.
Solar buildout is still much less capital intensive than other proven technologies such as offshore wind - which are required for energy security and moving towards a zero emissions grid. However, the lack of regulatory clarity has made the 30 GW of offshore wind capacity by 2030 outright impossible. In fact, first power from an Indian offshore wind project by the end of this decade seems to be a much more plausible goal. While it is true that there is insufficient capital inflow from developed nations for building out renewables, India does itself no favours with its complex regulatory procedures that inhibit the confidence of foreign investors in funding capital-intensive projects with long development cycles.
This puts in perspective the challenges to the ambition of becoming a world leader in Green Hydrogen production - a technology requiring an ecosystem which is even more capital intensive and yet to be tested besides pilot projects. If India has to sustain its stance on climate change, it needs to deliver mitigation solutions at the scale necessary to uphold the overall narrative of prioritising development.
Averting climate change, for India and the world, is a challenge greater than any we have faced before. Even one’s best efforts may fall short. The SYR is a timely reminder of this fact.
Top Stories of the Week
Non-personal data sharing norms in the pipeline
The India Data Management Office (IDMO), under the aegis of Ministry of Electronics and Information Technology (MeitY), will set out the norms to be followed by companies for anonymising personal data and using non-personal/ anonymised data. To the uninitiated, non-personal data is data or information that does not reveal an individual’s identity. It could be something as simple as the most popular restaurant or most popular dish ordered through food delivery apps in a particular area or pincode, or even something like the number of traffic challans issued at a particular junction. Non-personal data could be highly lucrative for companies, as it impacts their business decisions, and is also relevant for study by policymakers and academics alike when analysing issues.
This is another part of MeitY’s ongoing efforts to bring regulations for protection of digital data and creating a legal framework for its use for commercial purposes, research and development, and so on. Readers will recall that in late 2022, MeitY released the draft Digital Personal Data Protection Bill for public consultation, which is expected to be introduced in the Monsoon Session of Parliament later this year. MeitY also released a draft National Data Governance Framework Policy in May 2022.
Delhi government presents its annual budget
On 22nd March, the Delhi government tabled its budget for the year in the state assembly. With the theme, “Clean, Beautiful and Modern Delhi”, ₹78,800 crore have been allocated, including ₹56,983 crore under revenue expenditure and ₹21,817 crore under capital expenditure. This year’s budget has 6 key priority sectors, namely, infrastructure, transport, health, education, PwD and water supply.
With an infrastructure-driven approach, the government aims to strengthen and electrify the transport system, digitalise education, track and reduce pollution, enhance healthcare, promote skill development and encourage sustainability. The budget presentation also included the announcement of upcoming policies in the spheres of transport, labour and power. The App Based Premium Bus Aggregator Scheme, which will allow private bus operators to offer app-based premium AC buses on public demand will be announced, alongside the Delhi Motor Vehicle Aggregator and Delivery Service Provider Scheme. Four new schemes centered around skill development, toolkit distribution, free health check-ups, and crèche facilities shall also be announced for construction workers this year. Based on the suggestions from the public on the draft policy, the Delhi government is scheduled to notify its new solar policy by April 2023 tentatively.
Counting many wins for the growth that the state has seen, this is an important budget for Delhi, as it gears up to host the coveted G20 summit this year.
This Week in Policy
Economy and Taxation
India is looking to bring down the tax burden on private equity and venture capital investors in the country, following recommendations made by a panel led by former SEBI chairman, M Damodaran. The proposed measures may be introduced in the monsoon session of Parliament.
At Rs. 15.72 trillion, tax collection this year has reached 95.2% of the revised estimates for the year, and has well exceeded the budget estimate of Rs. 14.2 trillion. India is lagging heavily on its disinvestment target of Rs. 5 trillion for the year, however, and is likely to be Rs. 1.9 trillion short by the end of the fiscal year.
Labour
The Labour 20 engagement group of the G20 adopted two joint statements in its inaugural meeting in Amritsar, calling for ensuring social security portability and plugging the gender gap in the workforce. The group comprises of trade unions, labour scholars and delegates from the G20 nations.
The Gujarat Government has increased the minimum wage payable to 46 categories of workers by around 25% - a move which is expected to impact 2 crore workers.
As per EPFO payroll data, job creation in the formal sector has dipped by 2.6% in the month of January, from 15.29 additions last year to 14.86 additions this year. The month has also seen the lowest employee exit numbers in four months, at 3.54 lakh.
Agriculture and FMCG
Acquiescing to the demands of farmers in the state, Maharashtra government shall raise the subsidy on onions to Rs. 600/quintal from the present offering of Rs. 300/quintal.
Union Agriculture Minister, Narendra Singh Tomar, held bilateral meetings with agricultural ministers of Guyana, Suriname, Zambia, Mauritius and Sri Lanka to promote trade with India.
Healthcare
The DGCI has directed state drug regulators to ensure that pharmacists must directly be present in medical stores, and any drugs may only sold under their direct supervision. It has also asked state regulators to ensure that drugs are not sold without a prescription.
The Rajasthan Government has passed its Right to Health Act, becoming the first state in India to legislate for such a right. Controversially, the Act provides that patients must not be charged by medical establishments for emergency treatments.
Foreign affairs
Japanese Prime Minister Fumio Kishida is visiting New Delhi this week for the India-Japan Summit. A key point on the agenda is possible collaboration between G20 (under India’s presidency) and G7, which is set to be hosted by Japan next month.
India has summoned the UK ambassador on vandalism of the Indian High Commission in London and has reminded the ambassador of the UK’s obligations under the Vienna Convention on Diplomatic and Consular Relations.
Technology, Media and Telecommunications
On the heels of an observation by the Delhi High Court on ‘vulgar’ language used in OTT platform content, I&B Minister Anurag Thakur stated that ‘vulgarity’ and ‘abusive language’ in the name of creativity was unacceptable and that rules could be amended accordingly if required.
MeitY is reportedly working on a ‘negative list’ of countries with whom cross-border data transfers will be blocked, which will be published forthwith.
The Telecom Regulatory Authority of India (TRAI) has released its recommendations regarding community radio stations
PM Modi has flagged off India’s 6G project and official testbed, which is being developed by a consortium of IITs
International trade and commerce
India and the EU have concluded the fourth round of talks for a comprehensive free trade agreement, investment agreement and GI agreement, to strengthen ties between the two economic blocs.
Negotiators from India and 13 other ki countries participated in the US-led Indo-Pacific Economic Framework for Prosperity (IPEF) negotiations in Bali.
Banking, Finance and Insurance
Exercising caution in light of a high profile IPO debacle last year, SEBI returns preliminary filing papers of six companies over the past two months.
The Supreme Court directed SEBI to refund Rs. 300 crore to the National Stock Exchange of India in a case involving alleged lapses in the bourse's due diligence systems.
Manufacturing
Aimed at boosting the production of value-added steel in the country, the government plans to introduce the second edition of Production-linked Incentive scheme for specialty steel.
India targets an increase in its electronics manufacturing capability to ₹24 Lakh crore by 2025-26, subsequently creating over 10 lakh jobs.
Retail and e-commerce
On 23rd March, India's open e-commerce network ONDC marked its foray into the mobility sector, tying up with a ride-hailing company in Bengaluru to help local businesses take on the likes of Uber Technologies.
India Post signs a memorandum of understanding (MoU) with logistics aggregator firms to help MSMEs and enhance last-mile e-commerce delivery services across the country.
Logistics and Infrastructure
In a workshop organised by Department for Promotion of Industry and Internal Trade in partnership with Asian Development Bank, it was announced that a task force will be set up for formulating a framework to determine logistics costs in the country.
National Highway Authority of India aims to monetise 1,987 km of highways in 2023-24 through toll operate transfer and infrastructure investment trust modes. Thirty National Highway sections are already lined up as a part of the plan.
Ministry of Railways likely to offer various concessions including 25-30% relief in the existing roll-on, roll-off (RoRo) charges to truck operators on dedicated freight corridors in a bid to capture the modal freight share from national highways.
Sustainability and Energy
To save groundwater, a parliamentary standing committee recommended disincentivising water guzzling paddy and sugarcane crops by introducing measures such as pre-paid cards for power supply to curb electric water pump use and even restricting power supply to few hours a day.
Government plans to extend restrictions on the export of diesel and gasoline after the current fiscal year ends this month to ensure the availability of refined fuels for the domestic market
Tracking the G20
After a month of braving geopolitical storms, India’s G20 presidency resumed relative normalcy as a flurry of meetings took place this past week. The second tourism working group meeting took place in Siliguri, Udaipur hosted the second sustainable finance working group meet, while Gangtok held the second Startup20 engagement group meet.
Also, the Civil20 met for its inception conference. The Labour20 engagement group finally kicked off at its inception meet in Amritsar, focusing on universalisation of social security with women at the centre of future of work.
Upcoming Events
T20 Youth Engagement | Macroeconomic Policy Coherence, Global Trade and Livelihoods
March 27 | Fr. Depelchin Auditorium, St. Xavier’s College (Autonomous), Kolkata
ORF is organising a T20 Youth Engagement event on Macroeconomic Policy Coherence, Global Trade and Livelihoods at St. Xavier’s College, Kolkata on March 27th. The event will bring together scholars, graduate and post-graduate students from the Department of Economics at the college as well as interested students from other academic disciplines and Universities in the city. The event is designed to acquaint students with the workings of the G20 as well as the reach, impact, and significance of the T20 platform as an ‘Ideas Bank’ of the G20. More Information
India’s New Growth Recipe
March 29 | Hybrid
The Centre for Social and Economic Progress (CSEP) is hosting a flagship seminar on 29 March, 2023 on “India’s New Growth Recipe”. The seminar will be chaired by Rakesh Mohan, President and Distinguished Fellow, CSEP. On the panel will be V Anantha Nageswaran, Chief Economic Adviser of India. The seminar will start with a presentation on CSEP’s recently released paper, “India’s New Growth Recipe: Globally Competitive Large Firms”, which will be followed by a discussion on India’s growth performance over the last 25-30 years and what is needed to accelerate growth going forward. More Information | Registration Link
Clean Growth Summit 2023
March 31 | ITC Grand Central, Parel, Mumbai
FICCI is hosting a Clean Growth Summit with business delegation from the UK on 31 March at the ITC Grand Central, Mumbai. The delegation, representing sustainable infrastructure, including waste to energy, waste to value, built environment, air pollution; renewable energy including battery storage, smart metering and hydrogen sectors, is visiting India with an objective to pursue partnership opportunities with Indian companies. The summit aims to deliberate on addressing challenges faced by India and UK in reaching their net zero targets and how policy development and technology cooperation between the two countries can help addressing these challenges. More Information | Registration Link
A Few Good Reads
The perennially fantastic Matt Levine gives a step-by-step break down on the recent American bank collapses, as well as the Government’s response.
Ashutosh Varshney analyses Rahul Gandhi’s claim that India is not a nation but a union of states.
Shekhar Gupta notes that India’s great conglomerates have not created a single brand with global recognition, which illustrates the curious, outsourcing-oriented path India’s economy appears to have taken.
Noah Smith writes about ‘weaponised interdependence’, and why TikTok must be banned in the United States.
Former CEA Arvind Subramaniam highlights the opportunity in off-shore wind off the coast of Tamil Nadu.
Tweets of the Week
The Paperclip narrates the story behind the legendary radio show, Geetmala:
Chinmay Tumbe looks at the I <3 XYZ signs that are coming to dot the country:
A remarkable achievement!
Key Notifications and Reports
The Reserve Bank of India has released its monthly bulletin for March, which includes its annual state of the economy report.
The Forest Survey of India has released its ‘Indian State of Forest Report 2021’.
Primus Partners has released a report titled “Online Gaming in India: The Taxation Quandary,” which recommends measures that India can take for the sector to prosper.
The Lawrence Berkeley National Laboratory has released a report titled “Pathways to Aatmanirbhar Bharat”, which traces paths through which India can achieve cost-effective energy independence by 2047.
The Department of Administrative Reforms and Public Grievances has released its monthly report, ‘Secretarial Reforms’, for the month of February.
The Padma awards for the year 2023 have been announced.
The Spices Board has been reconstituted.