India is playing a key role in solving global challenges like climate action and alleviating poverty. With its population of around 1.4 billion, the country has the third highest greenhouse gas emissions in the world, behind China and the US. It has been able to reduce the percentage of its population living in poverty from 55% to around 30%, according to UN figures. However, the growing middle and upper classes still live alongside many millions of people who have to live on the equivalent of less than USD 1.90 per day. The country has been badly affected by the coronavirus pandemic.
India covers most of its high energy requirements with fossil fuels such as coal. The subcontinent accounts for around 7% of the world’s greenhouse gas emissions, and yet around one tenth of its energy demands remain unmet. In cities, private transport – with its high level of pollutant emissions – places additional strain on the environment and climate. In rural areas, about 60% of arable land and 40% of forest areas are degraded, and the droughts and flooding caused by climate change are exacerbating this effect.
India is one of Germany’s “global development partners”. In May 2022, a climate partnership was agreed between India and Germany. Under this partnership, Germany will provide EUR 10 billion in support to India by 2030. On behalf of the German Federal Government, KfW is promoting programmes and projects to help India overcome its challenges in the area of climate action and achieve its development policy goals. In-depth development cooperations have been established in the following areas:
KfW is helping India to close its energy gap, while at the same time creating environmentally and climate-friendly growth. The country is increasingly investing in renewable energy sources, with more and more electricity to be produced from biomass, solar and wind energy. Through KfW, Germany is promoting the construction of solar farms, the installation of solar panels on roofs of companies and private households, and the expansion of hydropower. At the same time, over one billion euros is being provided to support “green energy corridors”, which connect solar, wind and hydropower plants to the Indian electricity grid.
As the percentage of the Indian population living in urban centres is expected to rise to 50% by 2050, the development of climate-resilient infrastructure in cities is an important factor for India. Green urban mobility is also being promoted. This includes expanding metro and underground lines in Mumbai and other cities, improving bus transport, switching to electric buses and creating better links between the various transport systems.
Particularly in rural areas, KfW is helping India to reduce the risks associated with climate change and to safeguard people’s income streams. Climate-resilient, environmentally friendly and agroecological farming methods are being promoted to facilitate this, along with sustainable forestry.