As the world unites to celebrate World Environment Day on June 5th, 2024, India stands at a critical juncture in its sustainability journey. This year’s theme, “Restoring Our Earth,” resonates deeply with India’s multifaceted efforts to balance rapid economic growth with environmental stewardship. From expansive renewable energy projects and the burgeoning electric vehicle market to innovative waste management solutions and sustainable agricultural practices, India is charting a course toward a greener future. The government’s ambitious policies, like the National Action Plan on Climate Change and the FAME scheme for electric mobility, underscore a national commitment to sustainability. However, challenges such as effective policy implementation, securing adequate financing, and raising public awareness persist. Encouragingly, businesses are stepping up with green initiatives and transparent sustainability reporting, responding to a growing consumer demand for eco-friendly products.
As per our research at CMR, in Tier I cities, ~80% of consumers are willing to pay a premium for environmentally friendly devices, reflecting a significant shift in consumer behaviour. Collaborative efforts across government, industry, NGOs, and communities are essential to overcoming these challenges and seizing the opportunities ahead. As we reflect on our progress this World Environment Day, India’s evolving sustainability landscape offers hope and inspiration for a more sustainable future.
India is witnessing significant sustainability trends across various sectors, with notable advancements in renewable energy, electric vehicles, waste management, and sustainable agriculture. The country’s aggressive push towards solar and wind energy is leading the way, with India now being one of the largest producers of solar energy globally. The electric vehicle (EV) market is also expanding rapidly, driven by government incentives and growing consumer awareness.
- Renewable Energy: India has set ambitious targets to increase its renewable energy capacity, aiming for 450 GW by 2030. This includes substantial investments in solar and wind power, with solar parks and wind farms being established across the country.
- Electric Vehicles: The adoption of electric vehicles is on the rise, supported by initiatives like the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme. Major automotive companies are launching new EV models, and infrastructure development, such as charging stations, is gaining momentum.
- Waste Management: Innovations in waste management are also gaining traction. Companies are exploring circular economy models, focusing on reducing, reusing, and recycling waste. This includes efforts to manage e-waste and plastic waste more effectively.
- Sustainable Agriculture: In agriculture, practices such as organic farming, precision agriculture, and the use of bio-fertilizers are becoming more widespread. These practices not only enhance productivity but also reduce the environmental impact of farming.
Businesses in India are adopting various sustainability practices and innovations, with notable examples in packaging, climate tech, and supply chain management.
- Sustainable Packaging: Innovations in packaging to reduce waste and increase recyclability are becoming more common. Companies are using eco-friendly materials and designs to minimize environmental impact. In the consumer electronics sector, approximately three out of every five consumers appear to be environmentally conscious, willing to pay a slightly higher price for eco-friendly packaging materials and for companies that promote eco-friendly practices.
- Climate Tech: The climate tech space is seeing more innovation compared to consumer goods. Companies are developing technologies to mitigate climate change impacts, such as carbon capture and storage, renewable energy technologies, and smart grid solutions.
- Consumer Behaviour: CMR insights indicates that in tier-one cities, ~80% of consumers are willing to pay a premium for environmentally friendly devices. Of those, 71% prioritize sustainable packaging in their selection of electronic devices. However, there is an intent-action mismatch; while people express willingness to buy sustainable products, they often do not follow through due to cost concerns or lack of trust. Consumers are also confused by sustainability claims due to a lack of clear, verifiable information.
- Sustainable Supply Chain Management: Companies are ensuring that their suppliers adhere to sustainability standards. Initiatives like the Sustainable Supply Chain Management (SSCM) promote responsible sourcing, reducing environmental impact throughout the supply chain. As per CMR insights, two in every three consumers primarily opt for trading in old devices when acquiring new ones, and one in every four consumers regularly engage in electronic device recycling programs conducted by manufacturers or retailers, highlighting the importance of sustainable practices in supply chains. Collaboration among different stakeholders—government, industry, NGOs, and communities—is crucial for advancing sustainability in India. However, there is a lack of widespread collaboration, with many initiatives operating in isolated silos.
- Successful Partnerships: Successful partnerships and collaborations can significantly enhance sustainability efforts. For example, the Clean Ganga project involves collaboration between the government, private sector, NGOs, and local communities to clean and rejuvenate the Ganges River. This project showcases the importance of collective action in addressing environmental challenges.
- Need for Larger Forums: There is a need for larger forums for sharing best practices and innovations in sustainability. Creating platforms for stakeholders to come together, share knowledge, and collaborate on sustainability projects can drive more impactful and cohesive efforts. Public awareness about sustainability issues is growing in India, but there is still a long way to go. Consumers play a crucial role in driving business decisions regarding sustainability.
India’s regulatory landscape plays a significant role in shaping sustainability efforts. There have been positive steps, but there is still room for improvement.
- Positive Steps: The Indian government has introduced several policies to promote sustainability. The National Action Plan on Climate Change (NAPCC) outlines strategies to address climate change and promote sustainable development. The FAME scheme incentivizes the adoption of electric vehicles, and the Swachh Bharat Abhiyan aims to improve waste management and sanitation.
- Areas for Improvement: However, there is a need for stricter guidelines on sustainability claims, like those in the European Union. Current Indian laws allow for vague and potentially misleading sustainability claims. Stricter regulations are necessary to ensure that companies make genuine efforts towards sustainability and do not engage in greenwashing.
Despite these advancements, India faces significant challenges in achieving its sustainability goals. These challenges include:
- Policy Implementation: Effective implementation of sustainability policies remains a major hurdle. While the government has introduced various policies and initiatives, translating these into tangible outcomes requires robust execution at the ground level.
- Financial Constraints: Securing adequate financing for sustainability projects is another critical challenge. Many initiatives, particularly in renewable energy and waste management, require substantial investments. Access to affordable finance is essential for scaling these projects.
- Public Awareness: Raising public awareness about sustainability is crucial. Although there is growing awareness, sustainability is still largely seen as an elite conversation. The very poor in India have inherently sustainable lifestyles, while the middle class and wealthy are less engaged with sustainability. There is also a notable intent-action mismatch; people express willingness to buy sustainable products but often do not follow through due to cost concerns or lack of trust.
- Socioeconomic Variations: Sustainability varies in meaning across different socioeconomic groups. It is important to tailor sustainability initiatives to local contexts and lifestyles to ensure broader engagement and impact.
Looking ahead, there are several opportunities for sustainability growth in India over the next 5-10 years. Emerging trends could reshape the sustainability landscape.
Emerging Trends:
- Climate Tech Innovation: Continued innovation in the climate tech space, including renewable energy technologies, energy storage, and smart grids, will be crucial.
- Circular Economy Models: The adoption of circular economy models can help reduce waste and promote resource efficiency. Businesses are increasingly exploring ways to implement circular practices in their operations.
- Sustainable Agriculture: Advances in sustainable agriculture, such as precision farming and the use of bio-fertilizers, will play a key role in ensuring food security while minimizing environmental impact.
Major Opportunities:
- Scaling Renewable Energy: Scaling up renewable energy capacity offers significant opportunities for reducing greenhouse gas emissions and enhancing energy security.
- Green Finance: Expanding green finance mechanisms can provide the necessary capital for sustainability projects, enabling more widespread adoption of sustainable practices.
- Public-Private Partnerships: Strengthening public-private partnerships can drive more effective and coordinated sustainability efforts. Collaborative initiatives can leverage the strengths of different stakeholders to achieve common sustainability goals.
Way Forward:
- Local Context: Tailor sustainability initiatives to local contexts and lifestyles. Understanding the unique challenges and opportunities in different regions can help design more effective and impactful programs.
- Clear Communication: Ensure clear and verifiable communication about sustainability efforts. Transparency and accountability are crucial for building trust with consumers and stakeholders.
- Collaboration: Foster collaboration among government, industry, NGOs, and communities. Creating platforms for stakeholders to come together and share knowledge can drive more cohesive and impactful sustainability efforts.
- Education and Awareness: Invest in education and awareness campaigns to raise public understanding of sustainability issues. Providing tools and resources to help people make sustainable choices can drive behaviour change.
- Innovative Solutions: Encourage and support innovation in sustainability practices and technologies. Investing in research and development can lead to new solutions that address sustainability challenges more effectively.
