India’s economy has been witnessing growth, emerging as one of the world’s fastest-growing major economies. However, this rapid expansion has raised concerns about the sustainability of its economic trajectory against the backdrop of limited and increasingly strained natural resources. The country’s aspiration to become a global economic powerhouse must confront the delicate balance between fostering growth and ensuring the preservation and efficient utilization of its precious natural assets. India is the world’s third largest emitter of fossil fuels, and it still relies heavily on coal for its energy production1. Coal is one of the dirtiest fuels that contributes to global warming and climate change.
India’s sheer population size of over 1.3 billion places immense pressure on its natural resources. As the demand for energy, water, minerals, and other essential commodities continues to surge, the nation faces challenges in maintaining a harmonious relationship with its environment. To grasp the potential ramifications of this intricate dynamic, we must delve into several key aspects.
Firstly, energy production and consumption are crucial components of any nation’s economic engine. India has long been dependent on coal as its primary source of energy, which has led to significant environmental consequences, including air pollution and greenhouse gas emissions. As the nation embraces industrialization and urbanization, transitioning to cleaner and more sustainable energy sources such as solar, wind, and hydropower becomes paramount. While India has made strides in renewable energy adoption, it still requires substantial investments and a robust policy framework to accelerate this transition and curb carbon emissions. According to the World Bank, India’s renewable energy capacity increased from 86 gigawatts (GW) in 2020 to 101 GW in 2021, but it still lags behind its target of 175 GW by 2022.
Secondly, water scarcity poses a formidable threat to India’s agricultural and industrial sectors. With over 80% of available water resources already utilized, ensuring water efficiency and conservation becomes crucial. Sustainable water management practices, including rainwater harvesting and watershed development, can help mitigate water scarcity. Additionally, promoting water-efficient irrigation techniques and enhancing water-use efficiency in industries are essential steps towards preserving this invaluable resource. According to the World Bank, India’s per capita water availability declined from 1,816 cubic meters in 2001 to 1,544 cubic meters in 2011, and is projected to further decline to 1,140 cubic meters by 2050.
Furthermore, India is rich in biodiversity, but rapid urbanization and industrial expansion have encroached on vital ecosystems. The preservation of natural habitats and wildlife is vital not just for ecological reasons but also for fostering ecotourism, which can become an additional source of revenue for the nation. Implementing stringent environmental regulations and promoting sustainable practices among industries and consumers are essential in protecting India’s diverse biodiversity. According to the World Bank, India’s forest cover increased from 21% of its land area in 2015 to 24% in 2019, but it still falls short of its national goal of 33%.
The mining industry, which fuels the manufacturing sector, also has significant implications for natural resources. Proper management and regulation of mining activities are critical to minimize environmental degradation, prevent deforestation, and mitigate the loss of biodiversity. Encouraging recycling and the efficient use of minerals can help reduce dependence on resource extraction. According to the World Bank, India’s mineral production increased from $36 billion in 2015 to $46 billion in 2019, but it also resulted in higher levels of pollution and waste generation.
Additionally, India’s economic growth must not exacerbate income inequality and social disparities. Sustainable development should encompass inclusive growth, ensuring that the benefits of economic prosperity are shared among all segments of society. Addressing poverty, enhancing education and healthcare, and empowering marginalized communities can foster a more resilient and sustainable economy. According to the World Bank, India’s poverty rate declined from 21% in 2011 to 10% in 2019, but it still has one of the highest levels of income inequality in the world.
Moreover, reducing food waste and promoting sustainable agricultural practices will be crucial in ensuring food security for India’s vast population. Investing in research and technology to enhance crop yields while minimizing environmental impacts is a critical step towards a sustainable agricultural sector. According to the World Bank, India’s food production increased from 252 million tons in 2015 to 296 million tons in 2019, but it also faced challenges such as climate change, soil degradation, and water stress.
In conclusion, India’s economic growth trajectory undoubtedly faces significant challenges concerning the sustainable use of natural resources. Striking a balance between development and environmental preservation is imperative for ensuring the long-term viability. The World Bank projects India’s GDP growth rate to moderate to 6% in calendar year 2023 from 6.6% in 2022 due to higher interest rates weighing on investment and slower global growth weakening exports. However, India is poised to grow by an average rate of 6.5% over the next five years if it can overcome these challenges and leverage its favorable demographics.