CARBON COMPETITIVENESS: INDIA AT THE NET ZERO- TRADE NEXUS

India faces significant trade risks as 68% of its exports are sold to countries with net zero targets. The report highlights a critical 'carbon competitiveness' gap, particularly in professional and IT services, where India's embodied emissions are often over 10 times higher than its competitors due to a coal-heavy power grid. While India has made progress in renewable capacity, reaching 50% non-fossil installed capacity by 2025, it remains vulnerable to Carbon Border Adjustment Mechanisms (CBAMs) in the EU and UK. The report suggests that aligning industrial policy with clean energy and securing international concessional finance are vital for India to challenge China's manufacturing dominance and safeguard millions of export-related jobs.

• A substantial portion of India's export economy is exposed to climate-linked trade risks, with 68% of export value ($446 billion) sold to countries with net zero targets, supporting approximately 32 million domestic jobs.
• India's services sector, specifically professional and IT services, faces a severe carbon competitiveness deficit; professional services emit more CO2 per million dollars of output than 97% of other countries, with some competitors being up to 20 times more carbon-efficient.
• India's trade with the European Union is highly vulnerable to the Carbon Border Adjustment Mechanism (CBAM), particularly in the Basic Metals industry, where 70% of exports to the EU are directly exposed under current scope.
• The report identifies a significant emissions gap between India and China in manufacturing; India emits more CO2 per million dollars of output than China across nearly 69% of the export value targeted by the 'Make in India' initiative.
• India's agricultural sector is a critical employment hub, supporting over 16 million export-related jobs despite representing only 2% of export value in 2023, making these rural roles acutely vulnerable to shifts in global demand.
• India has achieved a milestone in renewable energy, with non-fossil sources accounting for 50% of installed capacity as of 2025, though coal-fired power still supplied 64% of demand in 2024.
• There is a massive financing gap for India's 2070 net zero goal, with an estimated $3.5 trillion gap requiring $1.4 trillion in international concessional finance to be unlocked.
• India's electronics industry is significantly less carbon-competitive than Southeast Asian rivals; its Computer, electronic and optical products industry emits five times more CO2 than competitors like Vietnam.

APA

Net Zero Tracker (n.d.). CARBON COMPETITIVENESS: INDIA AT THE NET ZERO- TRADE NEXUS. https://ca1-nzt.edcdn.com/PDFs-and-Excels/Carbon_Competitiveness_India_Net_Zero_Trade_Nexus_24_Jul_2025.pdf?v=1753285279

Chicago

Net Zero Tracker. CARBON COMPETITIVENESS: INDIA AT THE NET ZERO- TRADE NEXUS. n.d. https://ca1-nzt.edcdn.com/PDFs-and-Excels/Carbon_Competitiveness_India_Net_Zero_Trade_Nexus_24_Jul_2025.pdf?v=1753285279.

Wikipedia

{{cite report |author=Net Zero Tracker |title=CARBON COMPETITIVENESS: INDIA AT THE NET ZERO- TRADE NEXUS |url=https://ca1-nzt.edcdn.com/PDFs-and-Excels/Carbon_Competitiveness_India_Net_Zero_Trade_Nexus_24_Jul_2025.pdf?v=1753285279 |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{netzerotrackerndcarbon, author = {{Net Zero Tracker}}, title = {{CARBON COMPETITIVENESS: INDIA AT THE NET ZERO- TRADE NEXUS}}, institution = {Net Zero Tracker}, url = {https://ca1-nzt.edcdn.com/PDFs-and-Excels/Carbon_Competitiveness_India_Net_Zero_Trade_Nexus_24_Jul_2025.pdf?v=1753285279}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }