Summit Theme Paper: Pathways to 2040 - Collaborate Create Innovate

Creating a Sustainable Economy by 2040

While a tremendous economic growth expected for India over the next two decades, India is also likely to be faced by an ever increasing demand for all natural resources like energy, water, materials, land and fossil fuels. Economic growth would also result in increased consumption levels leading to increased pollution, increased levels of waste generation, ultimately resulting in higher GHG emissions. This necessitates a need for India to rethink its growth strategy in terms of sustainability to ensure that India can become a sustainable economy by 2040.

In the Indian context, a sustainable economy would refer to an economically viable, environmentally sound and socially responsible economy. As India strives to become a sustainable economy, the economic (GDP) growth needs to be supported through the interplay of three key pillars of Sustainable Production, Sustainable Consumption/Living and Sustainable Livelihoods. The graphic below depicts the pathways under each of the three pillars, which taken together, can lead to the creation of a sustainable economy in India.

Sustainable Production- Need of the hour in India

There has been a recent focus on improving India’s manufacturing capabilities in the last year with the government’s flagship Make in India campaign. The government has rightly identified the manufacturing and industrial sector to be the biggest driver behind India’s economic and social growth in the coming decades if India hopes to maintain an average of 7.5-8.5% growth.This will exert significant impact on the status of the other two pillars of a sustainable economy, namely, sustainable consumption and sustainable livelihoods.

Sustainability in India’s manufacturing sector, or the lack thereof can either propel India to the heights that the government envisions or sink the country into a mess of resource scarcity, pollution and unfulfilled human potential. Thus, this brief focuses on the Sustainable Production aspect to achieve a sustainable economy in India by 2040.

Roadmap for Sustainable Production in the Indian Economy

To determine the high priority industries which are likely to have the maximum impact on overall sustainability in the industry, Sustainability Outlook prepared a framework. This framework examined the various industrial sectors in India and takes into account several parameters like Contribution to GDP, Employment Contribution, Level of Exports and the Necessity Quotient for determination of priority status.

The eight industries which emerged as high priority are:

Identifying areas of sustainability interventionsin the high priority focus industries

The table below indicates the extent to which primary resource constraints are likely to impact each of the above identified high-priority sectors.

Degree of impacts of resource constraint on high priority sectors: Sustainability Outlook Analysis

Deep dive: Critical success factors for sustainability in high priority industries of focus

Sustainability Outlook examined these eight sectors and determined the steps that will be critical to ensuring sustainability in these sectors.

Impacts of High Priority Manufacturing Sectors; Source: Sustainability Outlook Analysis

Pathways to 2040: Ingredients to scale solutions

Today, in many of these industrial sectors, a significant traction has been seen in moving towards sustainability. The leaders in all these segments have already addressed their low-hanging fruits and are looking towards steps and measures that can drastically impact their resource consumption.

For industrial manufacturing in India to become environmentally sustainable by 2040, new solutions are emerging. These solutions, which will be instrumental for this transition, are common across these manufacturing sectors and are likely to game-changers for industrial resource sustainability over the next few decades.

These are:

• Use of Alternative Raw Materials
• Smart IT Tools
• Improved Process/ Technical Efficiency
• Waste stream recovery/closed loop systems

Apart from the above mentioned ingredients, other factors that will not have a direct bearing on the industrial processes but still be crucial in determining success of these initiatives will be

• Establish quantified goals for energy, water and waste
• Monitoring and reporting of successfully designed and implemented ‘Green’ projects.
• Involvement of employees and educating them regarding pressing environmental problems
• Make Socially responsible Investments (SRI) to support the cause of environment.
• Availability of innovative financing mechanisms to support sustainability initiatives, some of which are highly resource intensive and might not be feasible for smaller players

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