A Just Transition Approach for Developing a Green Economy

October18, 2022

“The world’s finest IT sector of India could be a very vibrant and dynamic incubator for innovation and R&D for the shared, connected and electric mobility revolution which is going to happen in India” said Shri Amitabh Kant, the present G20 Sherpa of India and former Chief Executive Officer of Niti Aayog, at the stakeholder consultation organised by CUTS International and Friedrich Ebert Stiftung (FES), discussing the need for “a just transition approach for developing a green economy – a case of electric mobility” at the India Habitat Centre, New Delhi on 18 October, 2022. With India aiming to be free from fossil-fuel imports by 2047, the main focus of its energy plans should be on green hydrogen owing to the favourable climatic conditions for manufacturing, he further added.

The consultation was based on the ongoing project between CUTS and FES – Exploring the potential of Last Mile Transportation as an enabler for Green Jobs which looks into the potential and impact of decarbonisation of last-mile connectivity on the local economy and livelihood opportunities, from a ‘just transition’ point of view.

Speaking on plans for driving electric vehicle adoption, Mr. Kant added, “India is essentially a market of about 75 percent of two wheelers (2Ws) and three wheelers (3Ws). Therefore, our policy should be that we should first ensure that 100 percent of 2Ws and 3Ws become absolutely green.” Further he felt that the next five decades are crucial for the country and green mobility will play a huge role when it comes to India’s strategy of “becoming the first nation in the world to industrialise with carbonising.”

Adding to the discussion, was Mr. Pradeep S. Mehta, Secretary General of CUTS who spoke about the issues with electric vehicle industry in India which includes skyrocketing demand for raw materials to make batteries, inadequate growth of charging infrastructure in the country, massive number and limited speed of e-rickshaws leading to traffic congestions and finally the subjectivity in the concept of just transition. Also, given the context of just transition he further added that the automotive industry relies heavily on SMEs for providing engine components, but with the e-mobility revolution, “How are we going to ensure that SMEs do not get affected adversely?”

Also addressing at the event was Mr. Ulrich Storck, Country Director, FES who highlighted the need for a just transition- “FES firmly believes that a just and inclusive transition can only be achieved by bringing wide range of interest groups such as worker organisations, environmental, youth and feminist groups into the discussion.”

Sucharita Bhattacharjee, Policy Analyst and Deputy Head, CUTS Calcutta Resource Centre made a brief presentation on the findings of the ongoing project with a focus on decarbonisation of the last mile connectivity in a ‘just’ manner, to set the context for the panel discussion that followed the Inaugural session.

Speaking at the panel discussion session, Anumita Roy Chowdhury, Executive Director, Research and Advocacy, Centre for Science and Environment, said that transition funding, protectionists measures for workers’ retirement planning, sharing of resources from one sector to other are the crucial components of the framework we would need in order to facilitate a Just Transition in the mobility sector. Conscious thinking and intense engagement with the government and other stakeholders including the climate groups, private players and trade unions will be required to prepare this strategic roadmap. She also pointed out that more than the environmental concerns; public health issues are compelling us to adopt measures without any further delays, to counter vehicular emission induced air pollution in several places including the national capital.

Other participants of the panel discussion session included Gautam Mody, General Secretary, New Trade Union Initiative and Siddhartha Goel, Senior Policy Advisor, International Institute for Sustainable Development who emphasised on developing a just society beyond the boundary of getting out of coal and into renewables & economic impact of a green energy transition on states heavily relying on fossil fuel taxation respectively.

Mody highlighted the exit of auto majors like General Motors and Ford from India, which are planning for going completely electric within few years and don’t see India as an EV manufacturing hub and don’t want to bear the complete cost of transition. He raised the issues of unjust relocation of people/ communities and ecological damages in the process of development of solar parks, and absence of tripartite dialogues between government, industry and trade unions which are critical for ensuring the rights of workers. He also spoke of the importance of a framework for dialogue between environment groups and trade unions; and the facilitating role of government in establishing such frameworks.

Goel remarked on the subsidy structure in India which is seven times higher for fossil fuels than clean energy, of which the larger share goes to solar and wind leaving a little for electric mobility. In global climate finance as well, most of the financing goes to renewable energy and only 10 percent is spent on public transport. So there’s a need to ensure a judicial financing in this case.

The panelists further discussed on skill development which has remained as another area of concern with limited financing for reskilling of the workforce. A mutual consent was formed to act timely on developing partnership and synergies across sectors, to re-build the narratives of different stakeholder groups to ensure evidence based informed decision-making process.

It was also discussed that the economics must be sound for any alternative to work in favor of the transition we are talking about. Amongst various fiscal measures, rationalization of taxes, adopting taxing the bad and funding the good approach, implementing the ‘polluter pays’ principle will be crucial to achieve this transition.
Panelists also addressed questions from the audience like how the global contexts like war, energy disruption and the recession that is likely to hit soon will also influence the pace of this transition.

They concluded that we would need a comprehensive national policy considering all the key sectors associated with the energy transition and integrating issues like the environmental justice, equity and employment generation.