The Climate Policy Initiative’s latest report underscores the urgent need for a fair transition to zero-emission trucks in India, spotlighting challenges and opportunities in the country’s trucking sector
The Climate Policy Initiative (CPI) has unveiled a new report titled "Just Transition to Zero-Emission Trucking in India," emphasising the critical importance of an equitable shift towards zero-emission trucks (ZETs) for India to meet its climate and air quality objectives.
According to the report, the road logistics industry in India is a significant contributor to the nation's environmental challenges, accounting for 4 percent of energy-related CO2 emissions and 53 percent of particulate matter emissions. The transition to ZETs is expected to bring about a considerable transformation within the sector, necessitating the development of specialised skills in manufacturing and maintaining electric powertrains, batteries, and advanced electronics. However, the report warns of potential financial difficulties for the fragmented trucking sector, particularly for those employed in informal jobs, such as mechanics, who may be adversely affected by this shift.
With projections indicating that India's truck fleet will quadruple by 2050, reducing emissions from this sector is essential for achieving the country's climate targets. Moreover, the transition to green mobility is not just a climate imperative but also a public health necessity, given the transport sector's significant contribution to harmful emissions.
Battery-electric technology has emerged as the most viable solution for replacing internal combustion engine (ICE) trucks. However, the transition to battery-electric ZETs poses significant challenges, including higher total ownership costs and limited charging infrastructure. Despite these hurdles, the sector is expected to grow, driven by anticipated cost reductions and favourable government policies. Nevertheless, ensuring a just transition is crucial to mitigate potential job losses.
The trucking industry in India employs millions of people across direct, indirect, and induced jobs. While the adoption of ZETs may lead to job losses, particularly in indirect roles (related to ICE trades) and induced jobs (informal sector jobs within trucking clusters), it is also expected to create new opportunities in emerging fields. The report highlights that the co-benefits of adopting ZETs include reduced public health expenditure and improved quality of life. However, it calls for a nuanced approach to ensure that the transition does not exacerbate existing inequalities.
The CPI report makes several recommendations for a just transition, advocating for a people-centric approach that prioritises the needs of direct, indirect, and induced workers. It stresses the importance of policy and financial interventions that focus on training, reskilling, and job placement programmes. Special attention should be given to communities impacted by trucking activities, particularly those located near major transportation corridors, who may bear a disproportionate burden during the transition.
One of the key recommendations is the establishment of a Just Transition Fund for India (JTFI) under the Ministry of Skill Development and Entrepreneurship (MSDE). This fund could leverage existing government schemes, such as the Pradhan Mantri Kaushal Vikas Yojana for skill development and the Pradhan Mantri MUDRA Yojana for loans, to finance reskilling programmes and support alternative livelihoods for those unable to transition to new roles within the industry.
The report lays the foundation for assessing the socioeconomic costs and investment requirements for a just transition to ZETs in alignment with India’s climate goals. The next steps include identifying affected stakeholders, designing targeted policy responses, and developing financial instruments to address their needs. Securing stakeholder feedback will be crucial for gaining buy-in and refining intervention designs through pilot programmes. Ultimately, the establishment of a just transition financing facility is envisioned to channel the necessary funds to support a fair and equitable transition to zero-emission trucking.