The shift to renewable energy could lead to new vulnerabilities in the supply chains for solar panels and critical minerals, the Economic Survey 2023-24 said. File (representational image)
| Photo Credit: K. Murali Kumar

India’s path to sustainable development is fraught with challenges, as the country grapples with the twin imperatives of meeting burgeoning energy demands and reducing carbon emissions, the Economic Survey 2023-24 revealed on July 22.

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Tabled in the Parliament, the Survey underscores the complexities of India’s green transition, emphasizing the need for a diversified energy portfolio to achieve ambitious growth targets while adhering to climate commitments.

“Balancing development needs with a low-carbon pathway is a tightrope, especially when financed predominantly through domestic resources,” the Survey noted, highlighting the financial strain of pursuing cleaner energy alternatives.

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The document stressed the critical role of non-fossil fuel sources in meeting India’s Nationally Determined Contributions (NDCs) and Net Zero goals. However, it also pointed out the challenges associated with renewable energy, including intermittency issues, waste management concerns for nuclear and solar technologies, and the potential impact of biofuel production on food security.

Acknowledging the importance of energy security, the survey advocated for a multi-pronged approach. It suggested diversification of energy sources, including renewables, nuclear, and biofuels; continued reliance on thermal power, particularly coal, to provide baseload support for renewable deployment; promotion of clean coal technologies like gasification and carbon capture, and enhanced international cooperation in R&D for emerging green technologies.

The Survey cautioned against over-reliance on imports, noting that while India’s dependence on petroleum imports is well-known, the shift to renewable energy could lead to new vulnerabilities in the supply chains for solar panels and critical minerals.

On a positive note, the report highlighted India’s significant progress in its mission-mode approach to addressing climate change. As of May 31, 2024, the share of non-fossil sources in installed electricity generation capacity has reached 45.4%, putting India on track to meet its updated NDC target of 50% by 2030.

The Survey called for a “more balanced approach” to climate change, suggesting policymakers focus on “nearer-term policy goals of improving human welfare” rather than being “excessively preoccupied” with long-term global climate management.

While acknowledging India’s achievements, the survey emphasized the need for financial support from developed countries.

With financing needs estimated at $2.5 trillion (at 2014-15 prices) for meeting NDC targets till 2030, access to finance and technology at reasonable costs is crucial to ease the resource constraints.

The agriculture insurance sector is likely to register growth from 2024 onwards. File
| Photo Credit: K.V.S. Giri

The agriculture insurance sector is likely to register growth from 2024 onwards, with an average real premium growth of 2.5% over the medium term, according to the Economic Survey 2023-24.

Also Read:Economic Survey 2023-24 LIVE updates

The survey, tabled in Parliament on July 22, noted that agriculture insurance, accounting for about 12% of the non-life insurance market, witnessed flat growth in FY23 due to a sharp decline in premium rates in the Kharif cropping season.

“However, this decline was more than offset by increased insured land area and farmer enrolments during the season,” it added.

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“Agriculture premiums will likely rise from 2024 onwards, with an average real premium growth of 2.5% cent over the medium term, supported by improvements in insurance infrastructure such as mobile applications and remote sensing for crop loss monitoring,” the survey said.

To address current concerns around crop insurance, the government has launched various technological initiatives. These include the YES-Tech Manual, WINDS portal, and enrolment app AIDE/Sahayak to assess crop damage via satellite-based advanced technologies.

The survey also highlighted door-to-door enrolment initiatives aimed at making crop insurance more accessible to farmers.

These measures are expected to enhance the efficiency of crop damage assessment and improve the overall accessibility of agricultural insurance in the country.

Currently, the government is implementing Pradhan Mantri Fasal Bima Yojana and the Weather Based Crop Insurance Scheme.

Only 4.4% of India’s young workforce is formally skilled, said the Economic Survey 2023-24. File
| Photo Credit: M. Moorthy

With only 4.4% of India’s young workforce formally skilled, linking skill development with production Linked Incentive (PLI) and employment-linked incentive schemes in high-growth potential sectors like toy, apparel, tourism, logistics and textiles would aid upgrading of skills as production moves up the value chain, the Economic Survey said on July 22.

The Survey for 2023-24 tabled in the Parliament stated, “in order to reap the demographic advantage, it is necessary to equip the workforce with employable skills and knowledge that meet the requirements of the globalised labour market”.

Currently, the PLI scheme is available for 14 sectors. Industry bodies have been demanding introduction of an employment-linked incentive scheme to promote job creation in the economy, in the face of a growing young population amidst concerns about jobless growth.

Also Read:Economic Survey 2023-24 LIVE updates

According to the Survey, to maximise the outcomes from skilling initiatives, convergence, and utilisation of synergies with other employment-centric programmes would mutually benefit the two verticals.

“Measures are being taken by government to translate India’s demographic dividend into a productivity dividend by enabling job and entrepreneurial opportunities that are in sync with the aspirations and abilities of India’s youth. It is partnering with the industry to enhance skilling with employability,” said the Survey.

Click here to download Economic Survey 2023-24

It further stated that “linking skill development with PLI scheme and employment-linked incentive schemes in high-growth potential sectors like toy, apparel, tourism, logistics, textiles, leather sector etc. would aid upgrading of skills as production moves up the value chain”.

An auction window is created under the NRS for making coal available for new coal gasification plants
| Photo Credit: G. N. Rao

The initiatives of the government for cleaner fuel such as coal gasification mission and exploring coal to hydrogen need to be promoted to reduce emission and increase environmental sustainability, the Economic Survey on July 22 said.

While phasing in renewables to the extent possible is crucial, in the short to medium term, the focus should also be on actively adopting clean coal technologies.

“With the arrival of ultra super-critical technologies for coal-fired power plants, it would be possible to bring down emissions and achieve higher efficiency,” the Economic Survey 2023-24 tabled in the Parliament said.

Also Read:Economic Survey 2023-24 LIVE updates

“In exploring the landscape for ensuring energy security, it has become evident that risks are not merely obstacles but also harbingers of opportunities. While uncertainties loom, they present avenues for innovation, adaptation, and growth for India. While phasing in renewables to the extent possible is imperative, in the short to medium term, the focus should also be on actively adopting clean coal technologies,” it said.

The government has launched the National Coal Gasification Mission to achieve coal gasification and liquefaction of 100 million tonne of coal by 2030. In line with the mission document, Coal India Ltd has signed pacts with BHEL, GAIL and IOCL to take up coal gasification projects in the country.

Click here to download Economic Survey 2023-24

To promote coal gasification, the coal ministry has formulated a policy wherein, a provision has been made for a 50% rebate in revenue share for all future commercial mines auctions for the coal used in gasification purposes provided the quantity of dry fuel used for gasification is at least 10% of total coal production.

Further, a separate auction window under the Non-Regulated Sector (NRS) has been created for making coal available for new coal gasification plants.