India can achieve its net-zero emissions target by 2070 while remaining on track to become a developed economy by 2047, but doing so will require an additional $6.5 trillion in investment from developed nations over current policy pathways, Niti Aayog said in a report on Monday.
The Niti Aayog report, titled Scenarios Towards Viksit Bharat and Net Zero, said achieving net zero demands unprecedented capital mobilisation, rapid deployment of clean energy, and sustained policy reforms across sectors.
Under the net-zero pathway, cumulative investment needs rise to $22.7 trillion by 2070, compared with $14.7 trillion under the current policy scenario. The incremental $8.1 trillion requirement is driven primarily by the power sector, followed by industry and transport, reflecting the capital-intensive nature of deep decarbonization.
What does NITI Aayog’s financial analysis suggest?
On the financing side, the analysis finds that with targeted reforms and deeper integration with global capital markets, India could mobilise around $16.2 trillion by 2070. To support this scale-up, the report strongly recommends establishing a dedicated National Green Finance Institution to mobilise, aggregate, and deploy capital for the transition.
Even under these assumptions, a financing gap of $6.53 trillion remains. “This gap has to be met by developed countries as part of their obligations to the developing world,” Niti Aayog CEO B V R Subrahmanyam said.
As a result, the share of international finance in India’s climate investment is projected to rise to about 42% by 2070, up from around 17% in 2022–23.
‘Measurable progress’
India has already made measurable progress. The study noted that the country has reduced the emissions intensity of its GDP by 36% from 2005 levels and achieved 50% non-fossil fuel power capacity five years ahead of its Nationally Determined Contribution target.
Despite this, current climate investment flows—estimated at about $135 billion annually, of which $80–90 billion supports clean energy—remain far below what is required to meet long-term goals.
With coordinated reforms at home and abroad, the study estimates that India can mobilise the resources required for its net-zero transition. Domestically, this will require deepening the corporate bond market from ~16% of GDP in 2023 to ~30% by 2070 and increasing the financialisation of household savings from about 60% in 2023 to 75% by 2070.
Energy demand is expected to rise sharply, driven by cooling, industry, and data centres, with cooling alone accounting for nearly two-thirds of residential energy demand. To manage this growth, the report calls for aggressive demand-side measures, including tighter appliance efficiency standards, stronger building codes, and behavioural interventions.
Electrification is identified as a central pillar of the transition. The share of electricity in final energy demand is projected to more than double by 2070, with transport and industry seeing the fastest growth. Road transport electrification is expected to exceed 70% under the net-zero scenario, compared with less than one-third under current policies.
On the supply side, the power sector is set for a major transformation. Renewable energy capacity—primarily solar and wind—must expand to 6,500–7,000 GW by 2070, supported by large-scale battery storage and pumped hydro. Nuclear power is expected to play a larger role as a source of firm, low-carbon electricity, while coal continues as a transitional fuel to ensure grid stability.
Industry decarbonisation will rely on efficiency improvements, circular economy measures such as higher scrap usage and lower clinker intensity, and the deployment of new technologies, including green hydrogen and carbon capture, to address residual emissions in hard-to-abate sectors.
The report also flags rising dependence on critical minerals such as copper, lithium, and nickel as a key vulnerability, even as fossil fuel imports decline over time. It stresses the need to strengthen domestic exploration, recycling, and diversified supply chains.