Energy, economy and environment are unequivocally crucial issues dominating the international agenda at any global platform today. As we enter a new era of policy making, the fate of our economy, our energy needs and environmental future are linked. It is now impossible to consider economic policy without factoring in our energy supply and the broader impact on the earth. If we holistically view these three Es?economy, energy and environment?our economy can both be dynamic and robust, while becoming increasingly energy-efficient as well as both environmentally and climate friendly.
To combat the impacts of climate change, the Prime Minister has released India?s National Action Plan on Climate Change, which includes eight missions providing a framework for addressing climate change as a core development issue. It outlines the national strategy to enable the country to adapt to climate change and enhances the ecological sustainability of India?s development path.
Energy happens to be the fuel for India?s economic growth. Building the much needed infrastructure for power generation, oil and gas and transpor-tation of energy from the supply point to the point of demand will require mobilisation of public and private funds within the desired investment framework. The rising energy demand is putting enormous strain on India?s infrastructure.
As mentioned by our Prime Minister, ?India is undergoing a major transformation. Our economy is expanding rapidly. Our financing requirements for the building of massive infrastructure in the next five years are estimated at over $500 billion.? Interestingly one-third of the funding is expected to come from the private sector. Public funds will not be sufficient to support rapidly growing energy demand and to increase energy access. Also, some of the world?s biggest banks and private equity funds have announced dedicated infrastructure funds for India, but unfortunately today India?s investment programme is struggling to find private investors to participate in expanding infrastructure due to the financial crunch. As such the authorities have turned to public private partnerships (PPP) as a way of bridging the huge funding gap.
To help the Indian economy revive, services & manufacturing will remain the main drivers of economic development and their viability and sustainability in turn is dependent on the affordable and reliable energy supply. Indian economy can get on to the road to recovery provided we can invest heavily in infrastructure related projects with specific thrust on energy and rural sector to create effective demand and to pull ourselves out of the recession.
Today, banks are not lending. Consumers are also not willing to spend. A psychological fear has gripped the market in an undesirable manner creating an environment of pessimism. Public investments alone cannot meet the growing infrastructure demands. The government has to make efforts to attract private capital into infrastructure. An important step in these initiatives would help achieve the objectives of high economic growth coupled with equity on a sustainable basis. With the worst financial downturn in the history, we need to put in extra efforts so as to tide over this financial tsunami. As of now managing energy and making adequate investments in the infrastructure sector could be an opportunity worth pursuing to get ourselves out of the recession and to enable us to achieve energy secured future.
For India, the best approach for economic growth and sustainability of its environment is to adopt clean energy-efficient technology along with energy conservation measures to ensure sustainability of the planet in the years to come. As we develop a ?3E? national policy framework, we can learn important lessons from those countries and regions that already have taken the lead.
In Japan, for example, the Green IT Promotion Council is an industry-government-university partnership to identify and implement policies to both reduce direct energy footprint and maximise ICT?s role in reducing the footprint of other sectors. Japan?s goal is to improve energy efficiency by 30% by 2020. The European Union also has taken a leadership role by beginning a policy process, led by the European Commission, to implement ICT-enabling policies aimed at reducing 98% contribution of other sectors.
We need to address our own unique challenges with policies tailored to our own political realities. A place to begin is by developing a national strategy like what Japan and the EU have. They have laid down a realistic road map of the specific policies and actions required to realise the economic, energy and environmental potential of ICTs.
Such a national strategy should include three complementary strands of policies and actions to make private industries and government more energy efficient, create behavioural changes to make us more energy efficient, and encourage ICT industry actions to reduce ICTs direct/indirect footprint.
These government policies and industry actions are not all that must be followed up to advance the ?E3? strategy, but they would begin a process of addressing our long-term problems with long-term solutions. These policies will promote new industries that create jobs, a sustainable and more energy efficient economy and enhance our energy audit. A national strategy that encompasses technology as an integral solution can be an important step for formulating a holistic policy to address our economic, energy and our environmental challenges.
?The writer is dean of executive postgraduate programmes & professor of energy economics at Management Development Institute