The two big opportunities we have today are the permeation of digital technologies and the green transition. Digital technologies, such as Artificial Intelligence (AI) and machine learning (ML), Big Data, and quantum computing, amongst others, are sector-agnostic and will give rise to new business models and use cases. Digital technologies hold the promise of increasing productivity and efficiency. A just energy transition can help create new jobs, preserve our ecosystems, and save us from the worst effects of the climate crisis.
And India stands poised to capitalise on these trends. India’s approach to technology has been to leverage tech to narrow inequalities, rather than widen them. We have seen this in the case of our digital public infrastructure, which helped us make decades' worth of progress in financial inclusion in just a few years. Or how it helped us roll out more than two billion doses of the Covid-19 vaccine. The government is also actively looking at futuristic technologies that can be leveraged in government programmes and schemes.
We have our eyes set on the future. For instance, take the India AI Mission, with ₹10,372 crore allocated, or the National Quantum Mission, with ₹6,000 crore allocated. Semiconductors today are essential to the economic security of a country. The India Semiconductor Mission with outlays of ₹76,000 crore, is a huge step in this direction. These missions will enable India to technologically leapfrog and play an integral role in accelerating the pace of our economic growth to become a $35-trillion economy in the Amrit Kaal, as envisaged by Prime Minister Narendra Modi.
In the past, we have seen how geopolitical events have led to sustained spikes in energy prices, particularly oil and gas. India being an oil-dependent country, has seen spikes in inflation, current account deficits, and fiscal deficits (when prices were controlled) when oil prices rise. Furthermore, India’s crude oil imports stood at ~$160 billion in FY23, accounting for 22% of our import bill. Periods of rising oil prices not only lead to inflation but also lead to volatility in the value of the rupee.
We have made significant strides in increasing the mix of renewables in our installed capacity in power, and by 2030, this mix will rise even further. However, different strategies were required to address emissions from the industrial and transport sectors. Furthermore, economic security was also high on the agenda. With geopolitical events dictating the price of energy, our strategy had to ensure the resilience of our economy to such shocks.
It is in this context that India launched the Green Hydrogen Mission with an outlay of ₹19,744 crore. Green hydrogen (GH2) has the potential to address emissions from both the industrial and transport sectors, while also enhancing India’s economic security, putting us on the path of energy independence.
Our strategy to decarbonise the transport sector is realistic and pragmatic – we recognise the role various technologies will have to play. Apart from GH2, we are also positioning India as a hub for electric vehicles (EVs). Whether it is the Production Linked Incentive (PLI) scheme for advanced chemistry cell (ACC) batteries with an outlay of ₹18,000 crore, or PLI for Advanced Automotive Technology, with an outlay of ₹25,938 crore, the entire EV ecosystem is being addressed. Recently, the manufacturing of electric four-wheelers has also been boosted, with global manufacturers incentivised to set up local manufacturing. The experience in aggregating demand to drive down prices (as in the case of LEDs) was also adapted for public transport. Under the Gross Cost Contract model, discovered prices of electric buses were found to be lower than those of diesel buses. Based on the success of the early models, the PM eBus Sewa scheme has been rolled out with the allocation of ₹57,613 crore; 10,000 electric buses are targeted to be rolled out in 169 cities, with adequate payment security mechanisms. Taken together, these moves will make India a global champion in the adoption of EVs and EV manufacturing, serving not just domestic, but also global markets.
Strong foundations have been set for India to technologically leapfrog. To make this a reality, we are devising strategies to boost our research and development (R&D) expenditure as a percentage of the Gross Domestic Product. Currently, our expenditure is behind countries that are ahead on the technological curve. And in these countries, most of the R&D expenditure comes from the private sector, with the government playing an enabling role. So, it is the private sector that must take the lead. Corporates and startups must partner with academic and research institutes to drive the R&D agenda. Recognising the need for long-term funding, ₹1 lakh crore for R&D was announced in the interim budget. India’s startups, corporates, and research institutes must come together to leverage these funds. While this addresses the funding gap, we must continue to work to bridge the manpower gap. First, we must improve educational outcomes at the school level in mission mode. Ensuring curricula that are up to date, and designed in consultation with industry is another area. Making research a more attractive career option through better pay in progression in government jobs is one avenue. Raising PhD stipends in public universities is another. Attracting global scientists to India or tapping into our diaspora are further avenues to pursue.
On technology, India has, till recently, played catch-up. However, we are now poised to capitalise on the global shifts and emerge as a technological leader. Strong foundations have been set. Backed by strong political will, there is every reason to believe that we will succeed.
The author is India’s G20 Sherpa, and former CEO, NITI Aayog. The views expressed are personal
Riding global winds to build India’s future
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14.04.2024
The two big opportunities we have today are the permeation of digital technologies and the green transition. Digital technologies, such as Artificial Intelligence (AI) and machine learning (ML), Big Data, and quantum computing, amongst others, are sector-agnostic and will give rise to new business models and use cases. Digital technologies hold the promise of increasing productivity and efficiency. A just energy transition can help create new jobs, preserve our ecosystems, and save us from the worst effects of the climate crisis.
And India stands poised to capitalise on these trends. India’s approach to technology has been to leverage tech to narrow inequalities, rather than widen them. We have seen this in the case of our digital public infrastructure, which helped us make decades' worth of progress in financial inclusion in just a few years. Or how it helped us roll out more than two billion doses of the Covid-19 vaccine. The government is also actively looking at futuristic technologies that can be leveraged in government programmes and schemes.
We have our eyes set on the future. For instance, take the India AI Mission, with ₹10,372 crore allocated, or the National Quantum Mission, with ₹6,000 crore allocated. Semiconductors today are essential to the economic security of a country. The India Semiconductor Mission with outlays of ₹76,000 crore, is a huge step in this direction. These missions will enable India to technologically leapfrog and........
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