Connect with us

Reports

India’s Transition to a Green Economy Presents a $1 Trillion Opportunity

Published

on

As consensus emerges on the urgency and magnitude of the transformation needed to decarbonize the global economy, India’s role and contributions will be critical if the world is to achieve current targets.

The World Economic Forum has released today a new report outlining how India’s path to decarbonization will have an estimated economic impact of over $1 trillion by 2030 and around $15 trillion by 2070.

The Mission 2070: A Green New Deal for a Net-Zero India report provides a roadmap for India’s transition to a low-carbon economy as it moves away from agriculture and services to manufacturing and a greener economy.

Published in collaboration with Kearney and the Observer Research Foundation, the report underlines the potential to save lives, catalyse new industries, create jobs and boost India’s contributions to addressing climate change.

At the ongoing United Nations Climate Change Conference (COP26) taking place in Glasgow, Prime Minister Modi has committed India to an ambitious five-part Panchamrit pledge. India’s five commitments are a critical foundation of the global pathway to achieve the ambitious 1.5-degree Celsius global warming target.

“How India continues to deliver growth and energy security to its citizens while ensuring the transition to a net-zero and green economy will define our collective success in the global fight against climate change,” said Sriram Gutta, Deputy Head, India and South Asia, World Economic Forum. “We are calling on the government, businesses and civil society to work with us to accelerate climate action and ensure a future that is good for both people and the planet.”

The report highlights five sectoral pillars and four cross-sectoral enablers for India to maximize the opportunities presented by a Green New Deal, with the potential to create more than 50 million net new jobs and over $15 trillion in economic value by 2070.

The five pillars – energy, mobility, industry, infrastructure and cities, and agriculture – contribute to over 90% of India’s greenhouse gas emissions. According to the report, India will need to address these pillars, alongside four cross-sectoral enablers, as part of its green transition.

These enablers are: an accelerated approach to green technology innovation, an overarching framework to catalyse green finance, an integrated approach to carbon, capture, utilization and storage, and a plan for climate adaptation. The five pillars and four enablers are dependent on India’s continued economic growth, driven by technological development, financial innovation and strong political leadership.

“This report visualises India becoming the world’s first $5 trillion and thereafter $10 trillion ‘off-carbon’ economy”, said Samir Saran, President, Observer Research Foundation. “In the decade ahead, we will all need to work together on sectoral and geographical pathways to build a green subcontinent.”

“India needs to action two transformations: an economic transformation to drive prosperity and a green transformation to drive sustainability. Our research indicates that the two need not be in conflict. In fact, India’s green transition might be the most viable way to fuel its economic aspirations,” said Viswanathan Rajendran, Partner, Kearney India.

A Green New Deal for India will need all stakeholders – government, the private sector, investors and civil society – to step forward and catalyse the next green revolution. India has an opportunity to take bold action to achieve strong, equitable and shared growth, and avert the worst impacts of a changing climate.

The report aims to serve as a framework for a collaborative effort across the World Economic Forum, Kearney and the Observer Research Foundation to accelerate climate action in key sectors of the Indian economy. Together, these organizations will work closely with relevant stakeholders in India to generate new insights, help inform discussions and policy frameworks, and facilitate new partnerships.

Continue Reading
Comments

Reports

Amidst Strong Economic Rebound in Russia, Risks Stemming from COVID-19 and Inflation

Published

on

Following a strong economic rebound in 2021, with 4.3 percent growth, Russia’s growth is expected to slow in 2022 and 2023, with a forecast of 2.4 percent and 1.8 percent growth, respectively, according to the World Bank’s latest Regular Economic Report for Russia (#46 in the series).

The Russian economy has now recovered to above its pre-pandemic peak, with growth driven by a strong rebound in consumer demand. In 2022, growth will be supported by continued strength in commodity markets, but will likely also be hampered by COVID-19 control measures and tighter interest rates.

Household consumption in the second quarter increased to more than 9 percent on the previous quarter (seasonally adjusted), showing the fastest rate of growth in a decade. Labor markets also saw a substantial upswing, with unemployment falling to a four-year low and real wages growing.

Russia’s current account surplus has also been exceptionally strong, on the back of high commodity prices and low levels of outbound tourism. The federal budget has been consolidated, led by a strong growth in revenue, and is on track to meet the authorities’ target of meeting the fiscal rule next year.

“This surge in spending resulted from the release of pent-up demand created by pandemic restrictions,” said David Knight, Lead Economist and Program Leader, World Bank. “It was aided by increased credit, Russian tourists staying at home for the holidays this year, and resource inflows via the energy sector.”

The report assesses the short-term risks weighing on Russia’s growth and finds that  low vaccination rates are necessitating stricter COVID-19 control measures that may reduce economic activity, while more persistent inflation will likely call for tighter interest rates for a longer period, limiting the growth outlook.

The report also analyzes how Russia could be impacted by global economic growth under three different green transition scenarios, and suggests that domestic climate action can help mitigate some of the possible impacts of a global green transition and create new opportunities for Russia.

The country’s new low-carbon development strategy, which aims for a 70 percent reduction in net emissions by 2050 and net carbon neutrality by 2060, will become an important first step for Russia. A focus on enabling the transition to a more diversified and faster growing economy will call for strengthening of a broad range of assets including human capital, knowledge, and world-class market institutions.

“Environmental sustainability is becoming central to the global economic agenda. Increased commitments by countries and firms to carbon neutrality signal that wholesale changes to policy frameworks will be needed in the coming years,” said Renaud Seligmann, World Bank Country Director for Russia. “With Russia’s pledge to become carbon neutral by 2060, the country now needs to take concrete actions of moving towards decarbonization.”

To accomplish these goals, the report recommends the implementation of carbon pricing and the consolidation of energy subsidies for consumers in Russia. At the same time, measures should be taken to ensure people are protected from the costs and any adverse impacts of the transition.

The report estimates that consumer energy subsidies on electricity, gas and petroleum in Russia amounted to 1.4 percent of the country’s GDP in 2019. By redeploying these resources, the authorities could increase GDP and ensure that no consumers are left worse off. At the same time, this would help reduce greenhouse gas emissions and move Russia closer to its goal of a green and sustainable economy.  

Continue Reading

Reports

World trade reaches all-time high, but 2022 outlook ‘uncertain’

Published

on

Global trade is expected to be worth about $28 trillion this year – an increase of 23 per cent compared with 2020 – but the outlook for 2022 remains very uncertain, UN economists said on Tuesday.

This strong growth in demand – for goods, as opposed to services – is largely the result of pandemic restrictions easing, but also from economic stimulus packages and sharp increases in the price of raw materials.

According to UN trade and development body UNCTAD, although worldwide commerce stabilized during the second half of 2021, trade in goods went on to reach record levels between July and September.

Services still sluggish

In line with this overall increase, the services sector picked up too, but it has remained below 2019 levels.

From a regional perspective, trade growth remained uneven for the first half of the year, but it had a “broader” reach in the three months that followed, UNCTAD’s Global Trade update said.

Trade flows continued to increase more strongly for developing countries in comparison to developed economies overall in the third quarter of the year, moreover.

The report valued the global goods trade at $5.6 trillion in the third quarter of this year, which is a new all-time record, while services stood at about $1.5 trillion.

For the remainder of this year, UNCTAD has forecast slower growth for the trade in goods but “a more positive trend for services”, albeit from a lower starting point.

Among the factors contributing to uncertainty about next year, UNCTAD cited China’s “below expectations” growth in the third quarter of 2021.

“Lower-than-expected economic growth rates are generally reflected in more downcast global trade trends,” UNCTAD noted, while also pointing to inflationary pressures” that may also negatively impact national economies and international trade flows.

The UN body’s global trade outlook also noted that “many economies, including those in the European Union”, continue to face COVID-19-related disruption which may affect consumer demand in 2022.

Semiconductor stress test

In addition to the “large and unpredictable swings in demand” that have characterized 2021, high fuel prices have also caused shipping costs to spiral and contributed to supply shortages.

This has contributed to backlogs across major supply chains that could continue into next year and could even “reshape trade flows across the world”, UNCTAD cautioned.

Geopolitical factors may also play a role in this change, as regional trade within Africa and within the Asia-Pacific area increases on the one hand, “diverting trade away from other routes”.

Similarly, efforts towards a more socially and environmentally sustainable economy may also affect international trade, by disincentivizing high carbon products.

The need to protect countries’ own strategic interests and weaknesses in specific sectors could also influence trade in 2022, UNCTAD noted, amid a shortage of microprocessors called semiconductors that “has already disrupted many industries, notably the automotive sector”.

“Since the onset of the COVID-19 pandemic, the semiconductor industry has been facing headwind due to unanticipated surges in demand and persisting supply constraints…If persistent, this shortage could continue to negatively affect production and trade in many manufacturing sectors.”

Continue Reading

Reports

Small Businesses Adapting to Rapidly Changing Economic Landscape

Published

on

The World Economic Forum has long been at the forefront of recognizing the strategic importance of sustainable value creation objectives for business. While interest has mostly focused on how large corporations contribute to the global economy and sustainable development objectives, small and mid-sized enterprises (SMEs) are often overlooked as major drivers of economic activity, as well as social and environmental progress around the world.

A new report released today finds factors that previously disadvantaged SMEs can lead them to new opportunities. Nine case studies from multiple industries and regions highlight what SMEs can do to increase their future readiness.

Developed in collaboration with the National University of Singapore Business School, the University of Cambridge Judge Business School and Entrepreneurs’ Organization, the report also finds that SMEs are lagging behind in terms of societal impact. Although there is a clear need to operate in line with sustainability goals, many SMEs have yet to include explicit strategies and performance measurement centred on societal impact.

The top challenges cited by SME executives include talent acquisition and retention (for 52.5% respondents), survival and expansion (43.8%), funding and access to capital (35.7%), non-supportive policy environment (21%), the difficulty of maintaining a strong culture and clear company purpose and value (20%).

SMEs can leverage their size, networks, people and the strengths of technology to support their goals of sustainable growth, positive societal impact and robust adaptive capacity. While it is essential for SMEs and the wider economy to increase their future readiness, they can thrive only insofar as the necessary supporting infrastructure and regulatory frameworks exist.

“We hope this will inspire and encourage SMEs and mid-sized companies to harness their potential in becoming a major driver of sustainable and inclusive economic growth and innovation by focusing on several core dimensions of future readiness,” said Børge Brende, President, World Economic Forum.

“Through this report, the Forum aims to highlight the significant role SMEs can play not just locally but also globally. The New Champions Community is a step towards bringing these smaller companies into the forefront of global discourse around socioeconomic development and engaging them in a community of forward-thinking companies from across the world,” said Stephan Mergenthaler, Head of Strategic Intelligence and Member of the Executive Committee, World Economic Forum.

The report aims to develop a deeper understanding of organizational capabilities and orientations needed for SMEs to successfully generate lasting financial growth, affect society and the environment positively, and develop high levels of resilience and agility.

It relies on robust research methods and combines rigorous primary and secondary research. The takeaways and conclusions presented in the research have been derived from an analysis of over 200 peer-reviewed articles and engagement of more than 300 CEOs and founders of SMEs through surveys and in-depth interviews.

Continue Reading

Publications

Latest

Africa2 hours ago

China will donate 1 billion covid-19 vaccines to Africa

Chinese President Xi Jinping  during his keynote speech, via video link, at the opening ceremony of the Eighth Ministerial Conference...

nagorno karabakh nagorno karabakh
Eastern Europe4 hours ago

Shifting Geography of the South Caucasus

One year since the end of the second Nagorno-Karabakh war allows us to wrap up major changes in and around...

Tech News6 hours ago

Uzbek home appliance manufacturer Artel joins United Nations Global Compact

This week, Artel Electronics LLC (Artel), Central Asia’s largest home appliance and electronics manufacturer, has become an official participant of...

Multimedia8 hours ago

Afghanistan: The Humanitarian Imperative Must Come First to Avoid Catastrophe | podcast

The international community must urgently step-up direct funding through United Nations agencies and NGOs to provide Afghan girls & boys...

Multimedia10 hours ago

Being Black in the Bundestag | podcast

The official dress down as Chancellor for Angela Merkel is in full swing. Recently, the first significant step that would...

Multimedia12 hours ago

Vaccine Passports Mandated in the New World Order | podcast

At this moment in western democracies, we are passing into a period of great unrest -social, political, and corporate where...

EU Politics14 hours ago

EU Cohesion policy: Commission announces the winners of the REGIOSTARS Awards 2021

Today, the European Commission has announced the winners of the 2021 edition of the REGIOSTARS Awards that reward the best Cohesion...

Trending