India, an ASEAN Dialogue Partner since 1996 and ASEAN Summit Level Partner since 2002, is fast becoming a linchpin in the Southeast Asia region having sealed an arms deal with Vietnam, sided with the Philippines over China sovereignty disputes in the South China Sea, and enhanced defense cooperation with Indonesia. (Rand Corporation)

But back home,  in 2023 India surpassed the population of China and now holds the record for being the most populated with 1.43 billion people, and a growing GDP of 6.5-7% predicted for 2024 (IMF). This is on the back of a record year in 2023, growing by 7.6% in the 12 months to the third quarter. (The Economist).

With this growth comes greater involvement in the region, but equally, greater domestic public investment which rose from 3.5% of GDP in 2019 to nearly 4.5% in 2023, The Economist reported. This increase is also stimulating and drives the reduction and transition of carbon-generated fuels to clean energy technology and sources through government

India stands on the brink of a monumental shift towards a green economy, poised to deliver a substantial economic impact exceeding $1 trillion by the year 2030 while generating more than 50 million new job opportunities.

India’s transformative journey is underpinned by five key pillars: energy, mobility, industry, infrastructure and cities, and agriculture. These sectors collectively account for over 90% of India’s greenhouse gas emissions. As India moves away from its traditional agrarian and service-oriented economic model towards a manufacturing-led growth trajectory, it finds itself at a pivotal moment to expedite its transition towards a net-zero and environmentally sustainable economy.

India pledged to reach net-zero emissions by 2070 – and has recently proposed to host the United Nations-sponsored COP33 summit in 2028 with a focus on combatting climate change and enhancing wildlife conservation.

Although India’s rural areas showed the fastest decline in poverty, from 32.59% to 19.28% in 2023, (UNDP) it also delivered record-breaking climate change devastations of deaths and displacement from floods, cloud bursts, landslides, wildfires, and earthquakes.

A welcomed Green Economy trade and investment opportunity for the Southeast Asia region

India’s Ministry of New and Renewable Energy announced their mission is “To make India the Global Hub for production, usage, and export of Green Hydrogen and its derivatives. This will contribute to India’s aim to become Aatmanirbhar -(which translates to ‘self-reliant India’, is a phrase the Prime Minister of India Narendra Modi and his government used and popularised about the country’s economic development plans) -through clean energy and serve as an inspiration for the global Clean Energy Transition. The Mission will lead to significant decarbonisation of the economy, reduced dependence on fossil fuel imports, and enable India to assume technology and market leadership in Green Hydrogen.”

India’s Clean-Energy Sectors

India launched the ‘National Green Hydrogen Mission’ with a target of 5 million metric tons per annum by 2030; and the global collaborative initiative of the International Solar Alliance  – a platform that is bringing together stakeholders to deploy solar energy technologies and secure US$1,000 billion of investments in solar energy solutions by 2030. Another issue that is shared throughout the region is behavioural influence campaigns to drive sustainable practices at the individual level, including Mission LiFE, encouraging environmentally conscious lifestyles. India has also co-founded the International Solar Alliance ISA, with France, leading the global movement towards solar power, with a focus on promoting energy access and transition; CDRI, and OSOWOG, which were highlighted by Prime Minister Modi during the 20th ASEAN-India Summit in 2023.

India’s inbound investment opportunities in the Green Economy

Budget 2023-24: The budget envisages several projects and initiatives spread across various sectors and ministries like Green Hydrogen Mission, Energy Transition, Energy Storage Projects, Renewable Energy Evacuation, Green Credit Program, PM-PRANAM, GOBARdhan Scheme, Bhartiya Prakritik Kheti Bio-Input Resource Centres, MISHTI, Amrit Dharohar, Coastal Shipping, and Vehicle Replacement.

Green and Sustainable Finance: The National Green Hydrogen Mission is a core lever as a catalyst of a meaningful change in the economy. With an outlay of INR 19,700 crore ($ 2.4 Bn), the mission aims to render India a market leader in the sector.

Sustainable Investment: The government announced its support for setting up a battery energy storage of 4,000MwH through viable gap funding “to steer the economy”.

Foreign Direct Investment: The World Bank’s Board of Executive Directors approved $1.5 billion in financing to accelerate India’s development of low-carbon energy.

Green Bonds: India has joined a growing list of countries using green bonds to help reduce the carbon intensity of its economy.