With a poupulation rapidly growing than China crammed into just one third of the area, India suffers from resource scarcity on a level unlike any other nation. So while it nominally faces many of the same challenges as other BRIC nations – water scarcity, dirty energy supplies, human rights issues – India’s population density makes its situation exponentially more difficult.
A World Bank study in 2014 found that environmental degradation like air pollution, water pollution, deforestation and natural disasters cost India $80bn per year, or nearly 6% of its economic activity. Of that total, 52% is attributable to air pollution.
If you thought China's smog was bad, Delhi’s air pollution levels can be twice as high, with even less government action to show for it. India’s air pollution is not only far worse than any of the other BRICs, it is so intense that it is reducing plants’ ability to photosynthesize sunlight, cutting crop yields in half.
While pollution is a broad problem across India, poverty and general lack of access to basic human needs is more of a first order problem, and one that draws the lion’s share of attention from government, businesses and people. In 2012, just 36% of India’s population had access to improved sanitation, leading the nation’s minister of rural development to call India “the world's open capital for defecations”.
As a result, much of the sustainable development discussion in India has focused on inclusion and bringing the population into the 21st century. In 2014, Prime Minister Narendra Modi launched the Clean Indian Mission, a five-year effort to eliminate open defecation, provide access to improved sanitation, and clean up the River Ganges, among other targets. Corporations have joined up with the Clean India Mission, committing to invest in education for girls and adopting communities for cleanup, among others.
Domestic and multinational corporations have been important partners for a range of India’s sustainable development efforts, although most of these business efforts tend to be focussed locally or regionally.
But in 2013, India became the first country in the world to mandate corporate social responsibility (CSR) practices, with a world-leading corporate law that requires about 8,000 companies in India to invest 2% of profits per year on CSR programs. The resulting investment could mean as much as $2bn per year will be invested in poverty reduction, environmental and social programs. The law similarly emphasizes that companies invest in areas local to its populations.
Plenty of debate remains about the current and future impacts of India’s CSR law and whether it will end up being a net good for the nation or simply result in check-the-box CSR practices.
But one aspect of the law stipulates that the investments can not be part of the normal sitiuation or solely benefit of the company’s employees. This condition could potentially prevent companies from investing in projects with both business and community benefits – such as switching from coal to renewable energy.
Even if the CSR law doesn’t spur investment in energy efficiency or green building, some companies are taking that step on their own, and are trying to spread the word about the many business benefits.
Information technology company Infosys pioneered an effort in 2014 to raise the profile of green building technologies among Indian firms. When it undertook an expansion of its campus in Hyderabad, the company built one to traditional standards and one with energy efficiency at its core. The resulting green building, which earned Leed Platinum certification, uses less than 38% of energy than its counterpart, and cost 1% less to build.
Building green as India expands is one example of the leapfrogging potential that all developing economies can benefit from. Rather than using 20th century building practices and then retrofitting for efficiency down the line, building green from the start could enable companies and the country to make more rapid progress towards their sustainability goals.
Another big area where India could advance more quickly than the rest of the world is in embracing renewable energy. India is perennially energy-starved – only 75% of the population has reliable access to electricity – and has an eye on its Himalayan neighbors’ bountiful hydropower resources. In one of a number of large scale Himalayan hydropower projects in the pipeline in Nepal, for instance, Bangalore-based infrastructure firm GMR Group in September signed a $1,4 bn deal to develop a 900-megawatt hydropower project on the upper Karnali River.