As green transition accelerates worldwide, India's hard-to-abate sectors, which contribute significantly to global emissions, face tough obstacles in achieving net-zero goals despite their carbon-removal potential
The global green transition is underway, with governments, regulators, and the private sector implementing strategies to reduce emissions. However, the focus of climate financing has skewed heavily towards mitigation sectors like renewable energy and transportation, leaving hard-to-abate sectors underfunded despite their crucial role in reducing carbon emissions. These sectors, including steel, cement, and transportation, contribute over 40 percent of global greenhouse gas (GHG) emissions.
India, the world’s third-largest emitter of GHGs, faces unique challenges in decarbonising these sectors. Industrial emissions, mainly from energy-intensive industries such as iron, steel, cement, and aluminium, account for 21 percent of India’s total emissions. While the energy and transport sectors are already transitioning towards decarbonisation through electrification and clean energy initiatives, the industrial sector presents distinct challenges. Unlike other sectors, industrial emissions arise not just from energy consumption but also from the processes themselves, complicating efforts to reduce carbon footprints.
Achieving a low-carbon economy in India without resorting to de-industrialisation requires a holistic approach, incorporating circularity, energy efficiency, and material efficiency. Experts argue that adopting circular practices and improving material efficiency could reduce carbon emissions in heavy industries by as much as 40 percent globally. However, this will not be enough to reach net-zero targets.
To fully decarbonise India’s hard-to-abate sectors, a combination of electrification, clean hydrogen, and advanced technologies such as carbon capture utilisation and storage (CCUS) will be essential. This multi-faceted approach, if implemented effectively, could significantly reduce emissions and set India on a path to achieving its ambitious climate goals.
As the global community continues its push for a greener future, India's ability to overcome these challenges will be critical to international climate efforts. However, adequate financing and technological innovation will be key in ensuring that hard-to-abate sectors can contribute meaningfully to the nation's net-zero aspirations.