Effect of Energy Transition Under Net-Zero Target on Employment

With increased focus on achieving the target of net-zero emission by 2070, Government of India is exploring different pathways of energy transition. The effect of such transition is not only limited to energy sectors but would have effect on employment in all sectors of the economy, through the strong interlinkage of energy sector with other sectors. In this paper, we intend to capture the direct and indirect effects of the energy transition on employment through social accounting matrix approach, for three alternative scenarios outlined in India Energy Security Scenarios (IESS) 2047 (Version-3.0), developed by NITI Aayog. Direct and total (direct, indirect, and induced together) employment multiplier for operation and management is estimated for different renewable vis-à-vis fossil fuel sectors. It is found that employment multiplier for renewable energy sources such as solar power generation is more than that of coal. However, employment multiplier for wind is found to be less than coal or gas. Coal being the dominant source of fuel in power generation, has high share in employment within energy sector, and renewable power sector still needs time and efforts to catch up. Considering the present policies in business-as-usual (BAU) scenario and aggressive transition to renewable energy while keeping the economic aspirations under net-zero scenario, our study shows that direct employment generation in energy sector would be similar under BAU scenario and net-zero scenario. In total employment generation, net-zero scenario is found to be more effective.

Sundarbans: A Critical Pillar for Climate, Economic Resilience in South Asia

The Sundarbans, spanning approximately 10,000 square kilometres across India and Bangladesh, is not only the world’s largest contiguous mangrove forest but also a critical ecological buffer zone and a major economic asset for both countries. Situated at the confluence of the Ganges, Brahmaputra, and Meghna rivers, this unique wetland acts as a natural defence mechanism, particularly against the frequent tropical cyclones that batter the Bay of Bengal. Despite its critical ecological functions, the Sundarbans faces severe challenges, ranging from climate change to unsustainable human activities, putting millions of people and the region’s biodiversity at risk.

Functioning as the “kidneys” of the Earth, wetlands like the Sundarbans play a vital role in regulating water flow and filtering pollutants. Yet, the Sundarbans goes beyond these functions. Its dense mangrove forest diminishes the impact of storm surges and cyclones, providing essential coastal protection. Studies, including one by the World Bank, demonstrate its capacity to reduce surge heights by 4 to 16.5 centimetres, depending on the location. This has proven lifesaving during tropical cyclones like Amphan, Sidr, and Aila, which would have wreaked even greater havoc were it not for this natural barrier.

Beyond environmental resilience, the Sundarbans is an economic powerhouse. Supporting around 7.5 million people, it contributes through provisioning, regulating, and cultural services. Provisioning services — fish, wood, honey, and other resources — have been valued at $713.30 per hectare annually, while its role in air quality improvement, water purification, and storm surge protection contributes $2,584.46 per hectare each year. Cultural services, too, provide intangible benefits, valued at $151.88 per hectare. Such contributions underscore the Sundarbans’ role not only as an ecological asset but as an economic backbone for local communities.

However, climate change and unchecked human activity pose unprecedented threats to this precious ecosystem. Rising sea levels, more frequent cyclones, and increased salinity are pushing the Sundarbans to the brink. With an average elevation of only one meter, even a minor rise in sea level could devastate this region. For instance, a one-meter rise would lead to the complete submergence of the Sundarbans, eliminating its forests and displacing thousands. Records from West Bengal’s Diamond Harbour reveal a sea level rise of 3.95 mm per year since 1972, while in Bangladesh, the rate stands at 0.36 mm annually since 1977. Combined with stronger storm surges, this gradual rise could cripple the mangrove ecosystem, allowing saltwater intrusion and triggering widespread land salinity that jeopardizes drinking water sources, agriculture, and local flora and fauna.

Future climate models paint a stark picture: post-monsoon cyclones in the Bay of Bengal are projected to increase by 50% in frequency by mid-century, with higher intensities. The  Sundarbans is also experiencing fewer rainy days but more intense downpours, leading to soil erosion, sedimentation, and shifts in soil chemistry. These changes affect water purification, carbon sequestration, and habitat stability. While rising temperatures could enhance carbon sequestration, the optimal range for mangrove photosynthesis tops out at 38-40°C. With temperatures in the region rising, prolonged droughts and heat spells risk transforming the Sundarbans from a carbon sink into a carbon source, accelerating regional and global warming.

Confronting these threats requires cross-border cooperation. Despite a Memorandum of Understanding signed in 2011 by India and Bangladesh, substantial challenges remain. Discrepancies in environmental policies exacerbate the problem. For example, while India restricts the establishment of thermal power plants within a 25-kilometer radius of the Sundarbans, Bangladesh allows them as close as 10 kilometers. Consequently, the Rampal coal-fired power plant, built just 14 kilometres from the forest, poses a serious threat, as do several cement factories operating within six kilometers. Comprehensive environmental assessments must be enforced before permitting industrial activities in this sensitive area to mitigate such risks.

Additionally, the immense population that depends on the Sundarbans adds to the strain on its resources. Many locals depend on fishing, wood collection, and other extractive activities to survive, often without awareness of the environmental costs. The issue is compounded by illegal wildlife trade and poaching, further endangering biodiversity. Authorities from both nations must enforce stringent regulations to control encroachment and ensure sustainable resource use. Offering alternative livelihoods could also alleviate pressure on the forest, and targeted education campaigns could foster greater environmental stewardship among residents.

The decline of the Sundarbans would be catastrophic for both India and Bangladesh. Losing this natural defence would expose millions to the full brunt of climate change impacts, including intensified cyclones, flooding, and loss of biodiversity. The Sundarbans is not merely a geographical asset; it is an irreplaceable lifeline that underscores the interconnectedness of ecological health and human resilience. Protecting it is not just an environmental obligation but a matter of regional survival.

The future of the Sundarbans rests in a united approach. For the people of both Bengal, the Goddess of the Forest stands as both protector and provider. If we fail to protect her, we risk facing an unspeakable loss that will resonate far beyond the borders of these two nations. It is time for policymakers, citizens, and the international community to come together, prioritize the Sundarbans, and commit to preserving this invaluable ecosystem for generations to come. Saving the Sundarbans is, ultimately, an act of self-preservation.

Tamanna Akter Tithi is associated with Dhaka University, Milan Mathew is associated with IUSS, Pavia and Raktimava Bose is associated with NCAER, Delhi. Views are personal.

Monthly Economic Review: November 2024

In the Review, we summarise the economic and policy developments in India; monitor global developments of relevance to India; and showcase the pulse of the economy through an analysis of high-frequency indicators and the heat map.

MER November Report

Click here for previous issues.

India Human Development Survey: November 2024

The IHDS Forum is a monthly update of socio-economic developments in India by the IHDS research community, based on the India Human Development Survey, jointly conducted by NCAER and the University of Maryland. While two earlier rounds of the survey were completed in 2004-05 and 2011-12, respectively. Fieldwork for the third round was undertaken in 2022-24 and the data is currently being cleaned and processed.

Click here for previous issues

Does climate-smart agriculture technology improve farmers’ subjective well-being? Micro-level evidence from Odisha, India 

Since the global population is expected to reach 9.7 billion by 2050, food production must increase by 70% in the next 30 years to provide food security in the face of climate change. Implementing climate-smart agriculture technology (CSAT) is essential for ensuring food security and promoting economic growth in the context of sustainable agriculture. Climate change and weather patterns significantly affect agricultural yield, necessitating the implementation of more efficient, productive, and climate-resilient techniques. However, the use of CSAT is a behavioural decision that affects the subjective well-being of the users. Using smart agricultural practices reduces climate change’s impact on agricultural productivity and promotes sustainable agriculture, improving adopters’ welfare. This study examines how the use of CSAT affects rural households’ subjective well-being in Odisha, India. The result of the study shows that the use of CSAT significantly affects the subjective well-being of the farmers. The measured impact is 0.149, 0.181, and 0.144 for farmers whose intensity is 0.251–0.500, 0.501–0.750, and 0.751 and above, respectively, as compared to farmers whose intensity is 0.0–0.250. This implies greater satisfaction for farmers who engage in the moderate use of CSAT practices. Low utilization of technology may not yield benefits for farmers, while the adoption of advanced technology may not be economically viable. Additionally, CSAT is not easily available to households residing in low-lying areas, preventing them from improving their well-being. Only a small number of landowners in impoverished areas utilize CSAT. Therefore, it is necessary to evaluate government regulations regarding land and tenancy as well as develop measures for farmers to adapt to new technologies.

    Get updates from NCAER