Perspective: G20 BRAZIL 2024 & India's Green Energy Strides | Current Affairs & Hindu Analysis: Daily, Weekly & Monthly - UPSC PDF Download

Perspective: G20 BRAZIL 2024

Why in News?
The recent G20 meeting concluded in Rio de Janeiro, emphasizing key commitments like taxing billionaires, energy transition, and supporting global climate efforts, including UNFCCC COP 30 in Brazil. India addressed the summit, stressing the importance of reducing poverty and boosting global food security.

Major Outcomes of the G20 Summit 2024

• Climate Finance Commitment: The G20 acknowledged the urgent need to scale up climate finance from “billions to trillions”, though no concrete plan was agreed upon for sourcing this funding. Leaders supported COP29 in Azerbaijan and called for enhanced financing to aid developing nations in adapting to climate change, although consensus on financial mechanisms was not achieved.
• Taxation of Billionaires: A significant achievement was the endorsement of measures to tax ultra-high-net-worth individuals. Brazil took a leadership role, discussing a potential global tax on the super-rich, though national sovereignty and tax principles remained unresolved.
• Global Hunger and Poverty Alliance: Brazil proposed a Global Alliance to combat hunger and poverty, gaining support from 82 countries. The initiative aims to help 500 million people by 2030, marking a milestone for the G20's focus on social action.
• Financial Reform and MDB Cooperation: The G20 reiterated the need to reform Multilateral Development Banks (MDBs) to better tackle global challenges like climate change and poverty. Leaders agreed on enhancing MDB cooperation to mobilize resources effectively for impactful projects.
• Energy Transition and Fossil Fuel Subsidies: While there was strong emphasis on investing in renewable energy and clean technologies, the summit did not reaffirm the COP28 commitment to phase out fossil fuel subsidies. A focus was placed on reducing food loss and waste as part of broader climate action.
• Global Governance and Social Inclusion: The G20 urged reforms in global governance to address inequalities. A G20 Social Summit emphasized combating hunger, poverty, and inequality while advocating for sustainability, climate change action, and inclusive decision-making.
• Inclusion of SDG 18: A new Sustainable Development Goal (SDG 18) was introduced, focusing on ethnic-racial equality, addressing systemic discrimination and promoting social, economic, and political inclusion of marginalized ethnic groups.
• Ukraine and Middle East Conflicts: The G20 supported peace efforts in Ukraine, calling for a comprehensive and lasting peace through diplomatic means. On the Middle East, the summit urged ceasefires in Gaza and Lebanon, focusing on the return of displaced people, the release of captives in Gaza, and humanitarian aid in Lebanon.

India’s Leadership Within the G20 and Its Impact on Global Issues

• Championing Food Security: India has prioritized global food security, utilizing its expertise in agriculture and technology to combat food crises. Through the Millet Initiative at the 2023 G20 Summit in New Delhi, India advocated for millets as climate-resilient crops to address global hunger and malnutrition.
• Reforming Multilateral Platforms: India has pushed for the reform of global multilateral organizations, including the United Nations and institutions like the IMF and World Bank. Under India's leadership, the G20 Roadmap for MDBs was adopted, calling for greater inclusivity and better representation of developing nations in decision-making processes.
• Supporting the Global South: India has emerged as a strong advocate for the Global South, amplifying its voice on issues such as sustainable development, climate finance, and equitable vaccine distribution. India’s expertise in innovation and technology has been shared with developing nations to help tackle challenges in healthcare, education, and energy.
• Bilateral Talks and Strategic Partnerships: On the sidelines of the 2024 G20 Summit in Brazil, India held significant discussions with countries such as Australia, Norway, Indonesia, Portugal, Italy, the UK, and France, exploring trade, investment opportunities, and fostering strategic partnerships. Notably, India-UK FTA talks included discussions on economic cooperation and extradition.

Major Challenges Faced by the G20 Grouping

• Global Hunger, Fuel, and Fertilizer Crisis: The G20 faces challenges in addressing intertwined crises of global hunger, food insecurity, and rising fuel and fertilizer prices, exacerbated by ongoing geopolitical tensions like the Russia-Ukraine war. The commitments to food security and the needs of the Global South remain unfulfilled.
• Geopolitical Rivalries Among Key Members: Political tensions, such as those between the United States and China, and conflicts involving Russia and Israel, hinder consensus-building. The Russia-Ukraine war has caused divisions within the G20, with differing views on sanctions and neutrality, often diverting attention from global issues.
• Divergent Economic and Political Priorities: The G20 comprises nations with diverse priorities. Developed nations focus on advanced technologies and climate transition, while developing nations, like India and Brazil, prioritize poverty alleviation and access to resources. These differences lead to disagreements on issues like climate financing, trade liberalization, and resource allocation.
• Weak Enforcement Mechanisms: The G20, as an informal forum, often lacks legally binding frameworks, leading to a gap between commitments and execution. Agreements, especially on climate finance and debt restructuring, often remain unimplemented due to a lack of accountability.
• Inadequate Representation of the Global South: Although the G20 includes emerging economies like India, South Africa, and Brazil, it still lacks direct representation for smaller, less-developed nations. Despite initiatives like the inclusion of the African Union, decision-making is often dominated by larger economies, limiting the influence of poorer nations.

Way Forward

Key Achievements of India’s Renewable Energy Sector

• India’s Fossil Fuel Subsidy Reforms: India began reducing subsidies on petrol and diesel gradually from 2010 to 2014, followed by incremental tax hikes until 2017. According to the Asia–Pacific Climate Report 2024, by 2023, fossil fuel subsidies were slashed by 85% (from USD 25 billion in 2013 to USD 3.5 billion), marking a significant shift towards clean energy. These savings were redirected towards initiatives like LPG for rural areas and investments in renewable energy.
• Role of Taxation: From 2010 to 2017, India imposed a cess on coal production to fund clean energy initiatives, allocating 30% of cess revenues to the National Clean Energy and Environment Fund (NCEEF). This helped support key programs like the Green Energy Corridor and National Solar Mission, significantly reducing the cost of solar energy and supporting off-grid solutions.
• Installed Capacity and Growth: India’s renewable energy capacity expanded by 24.2 GW (13.5%), reaching 203.18 GW in October 2024 (up from 178.98 GW in October 2023). The non-fossil fuel capacity, including nuclear, rose to 211.36 GW in 2024, up from 186.46 GW in 2023. 
  Specific growths include:
• Solar capacity: Increased by 20.1 GW (27.9%), reaching 92.12 GW by October 2024.
• Wind capacity: Grew by 7.8%, from 44.29 GW in 2023 to 47.72 GW in 2024.
• Large hydro projects: Contributed 46.93 GW to the renewable energy portfolio.
• Nuclear power: Added 8.18 GW.
• India ranks 4th globally in total renewable power capacity, 4th in wind capacity, and 5th in solar capacity, affirming its leadership in the global renewable energy transition.
• Renewable Energy Targets: India has set a 500 GW renewable energy target by 2030 as part of the Panchamrit framework outlined at COP26. The aim is for 50% of the country’s energy mix to come from renewables by 2030. This effort aligns with India’s broader climate goals of reducing carbon intensity by 45% by the end of the decade and achieving net-zero emissions by 2070.
• Green Hydrogen Commitment: India has committed to producing 5 million tonnes of green hydrogen annually by 2030, with a dedicated capacity of 125 GW for hydrogen production. This initiative is essential for decarbonizing challenging sectors like industry, transport, and heavy-duty power generation.

Key Schemes & Initiatives to Boost India’s Renewable Energy Sector

• Union Budget 2024: The Union Budget 2024-25 allocated Rs 10,000 crore for the Centrally Sponsored Scheme for Solar Power (Grid), marking an 110% increase from the previous year's allocation. 
• PM-Surya Ghar Muft Bijli Yojana: Launched with a budget of Rs 75,000 crore, this scheme aims to promote rooftop solar adoption, receiving Rs 6,250 crore for implementation.
• Exemption of Basic Customs Duty (BCD) on 25 critical minerals essential for the renewable energy sector.
• PM-KUSUM Scheme: The PM-KUSUM scheme promotes solar energy in agriculture by installing solar pumps and solarized agricultural feeders, targeting 34.8 GW of solar capacity. This initiative aims to reduce farmers’ dependence on grid power and diesel, supporting sustainable farming practices.
• National Green Hydrogen Mission: With an investment of Rs 19,744 crore, India’s National Green Hydrogen Mission seeks to develop a competitive green hydrogen industry. The focus is on decarbonizing industries, heavy transport, and energy storage while boosting economic growth.
• Solar Park Scheme: India has approved 55 solar parks with a combined capacity of 40 GW, simplifying land acquisition and attracting private investment.
• PLI Scheme for High-Efficiency Solar PV Modules: The PLI Scheme for High-Efficiency Solar PV Modules aims to reduce dependency on imports by incentivizing domestic manufacturing. The scheme targets a manufacturing capacity of 65 GW by 2026.
• Green Energy Corridor: The Green Energy Corridor aims to strengthen transmission infrastructure, with phase one already underway in eight renewable energy-rich states. Phase two will expand transmission networks across the country.
• Viability Gap Funding (VGF) for Offshore Wind: The VGF scheme supports offshore wind projects along India’s coastlines, aiming to generate 30 GW of offshore wind by 2030.
• International Leadership in Renewable Energy: India plays a leading role in global renewable energy efforts through initiatives like the International Solar Alliance (ISA) and the One Sun, One World, One Grid (OSOWOG) project, which seeks to create a globally interconnected renewable energy grid by 2050.

Challenges in the Renewable Energy Sector in India

• Land Acquisition: Securing land for large-scale solar and wind projects is a significant challenge, with many areas being densely populated or used for agriculture. Innovative solutions like using non-agricultural land and rooftop solar can help address this issue.
• Taxation in Clean Energy: The introduction of GST in 2017 subsumed the coal cess, altering funding streams for clean energy projects. A more consistent taxation framework is needed to ensure stable financing for renewable energy.
• Availability and High Cost of Technology: India faces challenges in sourcing critical renewable energy components like solar panels and wind turbines, primarily from China, which accounts for 94% of India’s solar PV cell imports. Strengthening domestic manufacturing and forming technology-sharing agreements can mitigate this risk.
• Grid Infrastructure and Stability: India’s existing grid infrastructure needs significant upgrades to handle renewable energy's intermittency. Investments in smart grids and energy storage solutions, as well as cross-border grid interconnections, are crucial.
• Financing and Investment: Attracting long-term investment remains a challenge due to high upfront costs, ongoing technological upgrades, and policy uncertainties. Innovative financing models, such as green bonds, can help attract investment.
• Regulatory and Policy Hurdles: Inconsistent regulations and delays in approvals across states slow down project implementation. Streamlining these processes and improving central-state coordination is essential for faster deployment.
• Skilled Workforce Shortage: The growing renewable energy sector requires a skilled workforce in areas like green hydrogen production and energy storage. Expanding training programs is vital for addressing this skill gap.

Way Forward

• Land Acquisition: India should focus on utilizing degraded land and promoting rooftop solar to reduce dependence on large land areas. Collaborative models for land pooling and policy incentives for landowners can also expedite the process.
• Taxation in Clean Energy: The government should reconsider the taxation framework to ensure consistent and sustainable funding for renewable energy projects, with clearer allocations for clean energy initiatives.
• Availability and High Cost of Technology: India should prioritize strengthening domestic manufacturing for key renewable components. Public-private partnerships and technology-sharing agreements can also reduce dependency on foreign suppliers.
• Grid Infrastructure and Stability: Upgrading the grid with smart technologies and energy storage solutions is essential for accommodating intermittent renewable energy. Cross-border grid interconnections can also help balance supply and demand.
• Financing and Investment: India should introduce green energy funds and long-term financial models like power purchase agreements (PPAs) to attract investors, offering clear incentives and reducing bureaucratic barriers.
• Regulatory and Policy Hurdles: Creating uniform policies across states and streamlining approval processes will speed up project implementation and foster investor confidence.
• Skill Development Programs: Expanding training programs in emerging renewable energy technologies will help address the sector's labor shortage and support India's renewable energy goals.