Jobs  

India’s employment needs are significant; in April 2023, the country’s unemployment rate was 8.11%. Nearly half of India’s population is employed in the agriculture sector, facing decreasing productivity, debt traps, inefficient and outdated technology, increasing climate risks, and a lack of livelihood alternatives; this is also leading to urban migration primarily for informal work. The Micro, Small and Medium Enterprises (MSMEs) sector, which contributed to over a fourth of India’s GDP in 2022 and currently employs over 11 crore people, is facing high levels of financial distress. Recent crises, including the COVID-19 pandemic and rising energy prices, have aggravated job and business instability for workers across these sectors in rural and urban India. Low-income communities without access to reliable and formal employment are more vulnerable to physical climate risks, as they lack the financial capacity to invest in resilience-building measures; this can increase the risk of climate-induced migration and the losses they suffer when disasters strike.

As India responds to the climate crisis with strong decarbonisation goals, a new economic paradigm of low-carbon growth is emerging that offers solutions for both energy security and livelihood creation, through renewable energy. India’s updated Nationally Determined Contributions (NDCs) capture this ambition; by 2030, the country aims to meet about 50% of its cumulative electric power installed capacity from non-fossil fuel-based resources. It also aims to become energy independent, with the AatmaNirbhar Bharat philosophy at the centre. Beyond mitigation, these measures can also have massive socio-economic benefits through climate-friendly livelihood generation. With the development of green hydrogen production capacity of at least 5 Million Metric Tonnes (MMT) per annum, the National Green Hydrogen Mission, for example, aims to abate nearly 50 MMT of annual GHG emissions, create over 6 lakh jobs, and cumulatively reduce over INR 1 lakh crores of fossil fuel imports. As of 2019, the total workforce in India employed in on-ground solar and wind projects was over 1 lakh, a five-fold increase from 2014 – and this sector could potentially employ more than 1 million people by 2030.

While utility scale jobs lie outside the purview of philanthropic or CSR funding, there are other arenas where livelihoods-based work can take on a climate lens. For instance, the job creation potential of decentralised renewable energy (DRE) applications across sectors, for low-income groups in rural and urban areas, is particularly promising. DRE solutions are crucial, as they tie clean energy access to economic productivity, reducing physical labour required and time spent on labour-intensive activities – and address twin challenges of India’s widespread energy and employment insecurity. The projected market potential is significant. The textile sector, which directly engages an estimated 45 million people, holds a likely market potential of USD 2.4 billion for solar-powered manufacture of fabric and garments. In rural areas, the market for clean energy- powered productive applications including cold storages, sewing machines, looms, rice mills, etc., is an estimated USD 53 billion. These solutions can thus increase access to clean energy and help communities transition away from carbon-intensive business models; help ‘green’ key livelihood sectors such as agriculture, MSMEs, and other small businesses; and modernise crucial equipment and appliances, reducing drudgery and increasing efficiency. DRE solutions are also crucial for adaptation and resilience, providing instant, reliable, and continuous access to electricity in climate-vulnerable areas that can get disconnected from the grid during climate-related disasters like floods and cyclones.

However, widespread adoption of DRE solutions is limited by several factors. There is a lack of adequate support and visibility for DRE applications, and a shortage of job-ready individuals for manufacturing, operations, marketing, etc., in these areas. The upfront costs of DRE are high, and micro-entrepreneurs and small businesses lack the finance required to support DRE solutions at nascent stages or bring them to commercial viability. Access to other sources of finance is not easy. DRE-based government subsidies are emerging but face challenges in reach, effectiveness, and how they are structured. There is a lack of adequate awareness among investors as to the significance of DRE-based livelihoods, and low willingness to invest as these solutions carry a high-risk perception due to their dependence on government subsidies. For more remote geographies, the lack of available engineers to service, maintain and repair these systems can also make them prohibitively expensive.