Balancing manufacturing ambitions and net zero goals is a key challenge for India: CEA Nageswaran
Noting that emissions are largely a legacy of fossil-fuel-led growth in advanced economies, Chief Economic Advisor (CEA) Anantha Nageswaran has said that India faces an unprecedented challenge as it seeks to expand manufacturing while lowering its carbon footprint.
ANI
Feb 09, 2026 18:50 IST
New Delhi [India], February 9 (ANI): Noting that emissions are largely a legacy of fossil-fuel-led growth in advanced economies, Chief Economic Advisor (CEA) Anantha Nageswaran has said that India faces an unprecedented challenge as it seeks to expand manufacturing while lowering its carbon footprint.
Speaking to ANI on the sidelines of the event for the launch of NITI Aayog Study Report titled 'Scenario Towards Viksit Bharat and Net Zero', Nageswaran said the release of the report is significant in India's planning for net zero and combining it with other goals.
"While emissions are largely a legacy of fossil fuel-led growth in advanced economies, India now faces an unprecedented challenge as it seeks to expand manufacturing while simultaneously lowering its carbon footprint. The release of this report is a significant milestone in India's planning for net zero and combining it with its mixed goals, which come before the net zero transition," he said.
The CEA said NITI Aayog has put together a very good report, which is rigorous, high-quality, and will serve as a benchmark for all future deliberations.
Nageswaran said that India's manufacturing share of GDP has remained around 18 per cent over the past decade, with services driving the growth for several decades.
He emphasised that manufacturing is critical for India's aspirations to become a global economic power, citing its role in lowering the cost of capital, strengthening the currency, and enhancing state capacity.
"Manufacturing matters much more for state capacity than services do. A renewed push for manufacturing, also highlighted in the recent Union Budget and the Economic Survey, would inevitably raise the emission intensity of the economy, making India's net-zero journey more complex than that of many other countries," he said.
Highlighting the scale of the transition, Nageswaran also underscored the investment requirements.
Amid geo-political tensions, strain on multilateral institutions and rise of protectionist tendencies in the world, he said India would have to rely largely on domestic resources. This, in turn, would require sustained economic growth, higher household savings, employment generation, and investment creation, he said, pointing to the need of an "endogenous" growth-investment cycle.
The CEA also drew attention to the energy-intensive nature of renewable energy technologies.
Citing figures from the Economic Survey, he noted that generating one gigawatt of solar power requires large quantities of silver, polysilicon, and aluminium, while wind power depends heavily on copper, the extraction and processing of which involves significant energy use and logistics.
"These facts remind us that the energy intensity of renewable energy itself is quite high, making a strong case for investment in moonshot technologies such as carbon capture, utilisation and storage (CCUS), as well as breakthroughs to address intermittency and storage challenges in renewable energy systems," he said.
Nageswaran stressed that advances made by India in science, research and development would not only support its own transition but also benefit other emerging economies facing similar constraints.
He called for a significant scaling up of R&D efforts in areas such as reducing the energy intensity of renewables, improving storage solutions, and advancing carbon capture technologies.
On the NITI Aayog report, CEA said it should be treated as a "living document" that would need to be updated periodically as technology, economic conditions, and global circumstances evolve.
"This document will be a stable reference for researchers, policymakers, and students of economics and climate change," he said. (ANI)
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