When it comes to climate change, every government faces a quandary. How much economic growth should be sacrificed on the altar of global warming? This is doubly true for an emerging economy whose development is often marked by a rapid increase in carbon emissions. India’s National Action Plan for Climate Change is clear as to where its priorities lie: climate change commitments cannot be undertaken at the expense of overall economic growth. In particular, India will not accept the guillotine of a Kyoto Protocol-style fixed limit on carbon emissions. New Delhi will receive no praise for this stance abroad — and should expect criticism at home. However, any hard-nosed assessment of costs and benefits will conclude this is the only policy path for India.
It helps to recognise that a carbon policy is really a subdivision of a country’s energy policy. Carbon curbs are a tax on the use of energy. India is heading for a large jump in energy use for two key reasons. One, roughly half the population will gain access to electricity for the first time in the coming decades. Two, it is on the threshold of reviving its moribund manufacturing sector. Western authors who claim Indians buying SUVs and airconditioners are the problem are propagating a myth — this is a small part of India’s energy story. It is the expanding cement, steel and glass sectors which will consume the lion’s share of India’s future energy. These are essential to the economy but cannot be fueled by wind turbines and solar panels.
The action plan’s main accomplishment is to commit India to grow on a greener path, to avoid the grimy growth curve of the West. Industries will be expected to meet international energy standards. Carbon will be sequestered through forestation. The action plan indicates that the poor world’s carbon policy will be mitigation rather than expensive carbon reduction. New Delhi has outlined a strong ethical position, arguing over three-quarters of all man-made carbon emissions have been produced by the West so it is absurd to ask the likes of India and China to live off the remainder. However, India does not bring a spotless record to the table. One obvious stain is the degree to which petroleum product consumption is subsidised. A commitment to removing these subsidies — a fraction of which help the poor — needs to be part of any credible action plan.