India Has Financial Resources but Wants Developed Countries to Bear Full Cost of its Solar Energy Program

  • Published on August 9th, 2009

A week ago a leading Indian daily published findings from a government report which assessed the feasibility of providing $17 billion in solar subsidies over the next 30 years.


The report notes that the Indian government has complete financial resources to fund the highly ambitious goal of increasing solar energy production to 200,000 MW, from current 2 MW, by 2050. But many independent experts have found flaws in the report and people within the government are concerned about a specific finding of the report.

The report notes that India will be able to afford the complete expenses of the program which will make India one of the largest producers of solar energy, if not the largest.

(T)he solar mission document suggests that India would be able to fund the entire project on its own. Government officials have pointed out that it would be hard to demand additional funds from the industrialized countries if India claims it can afford to sponsor such a large subsidy off its own resources.

The Indian government has been very careful with the timing of announcements of clean energy and environment protection plans. The National Action Plan on Climate Change was unveiled last year just before the G8 meeting in Japan which where the leaders of developed countries were to discuss 50 percent carbon emission cuts by 2050. Although there was no decision on any emission cuts, it seems pretty clear that the action plan was announced in order to dodge any demands of similar emission cuts from India especially because the action plan only stated eight goals while failing to provide funding details for the same.

With the date for Copenhagen climate talks approaching fast and developing countries feeling the pressure to discuss possibility of minor or sectoral emission cuts, the Indian government announced this highly solar energy plan which, experts say, is very unrealistic given the high costs associated with solar power.

While New Delhi continues to announce ambitious plans to expand renewable energy infrastructure and environment protection, it has grossly failed to explain how it would finance those projects. There were no budget allocations for either forest conservation & expansion or for renewable energy research or projects.

India seems highly interested in tapping the opportunity that the Bali climate change conference presented when developed countries agreed to form a multi-billion dollar adaptation fund to help developing and poor countries get access to costly clean energy technologies. India has already stated, many times rather bluntly, that it has no intentions of discussing even voluntary emission reduction targets.

These developments only demonstrate India’s willingness (or rather the lack of it) to contribute in any substantial way to not just reducing its carbon emissions but also to help the international negotiations reach any meaningful conclusion.

The views presented in the above article are author’s personal views and do not represent those of TERI/TERI University where the author is currently pursuing a Master’s degree.

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About the Author

currently works as Head-News & Data at Climate Connect Limited, a market research and analytics firm in the renewable energy and carbon markets domain. He earned his Master’s in Technology degree from The Energy & Resources Institute in Renewable Energy Engineering and Management. He also has a bachelor’s degree in Environmental Engineering. Mridul has a keen interest in renewable energy sector in India and emerging carbon markets like China and Australia.


  • We don't need a separate deal to fund Indian and Chinese renewables. Under Waxman-Markey passed by the House, US will fund the building of wind and solar and more via the offset program. Once Waxman kicks in expect to see $120B+ per year going overseas primarily to China and India. (ref UN CDM data base of offset projects– loaded with Chinese wind; India in second place)

    $120B is our annual purchases of oil from OPEC and twice that from the Persian Gulf. It is 50% of our trade deficit with China.

    Next we'll be hearing about being at the mercy of a "CO2 OPEC"?

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