Drivers and critical paths of carbon emissions in India: a structural path decomposition analysis

ABSTRACT

As a fast-growing economy with over 1.35 billion people, India will be critical to achieving future climate targets. The country implemented many policies to limit its carbon emissions. To make targeted policies, it is imperative to evaluate the mutually opposing effects of fast development and climate policies on carbon emissions. We apply environmentally extended input-output analysis, and structural path and decomposition analysis to calculate key emission statistics and drivers of change in critical sectors and production paths. Results reveal that India is a net exporter of emissions and its production and consumption-based emissions have more than doubled between 2000 and 2016. Two sectors, ‘Electricity, gas, and water’ and ‘petroleum, chemical, and non-metallic mineral products,’ function as supplying sectors in most of the critical paths. Although improvements in emission intensity and production structure have helped in reducing emissions, household consumption and investments have increased them.

KEYWORDS:

• Carbon emissions
• multi-regional input-output analysis
• structural path decomposition
• structural decomposition analysis
• emission intensity
• India

List of Abbreviations

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Acknowledgments

The authors are thankful to Maulana Azad National Institute of Technology, Bhopal (India), for providing the necessary support and platform for the successful completion of this work.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

¹ In this study, three types of terms have been used to represent gross emissions. Their meanings in the context of this work are as follows. Direct Emissions from Production (DEP) are emissions made by a sector to meet its final demand and also to produce intermediate inputs for other sectors (excludes emissions in the supply chain). Total Emission from Production (TEP) includes all emissions in the supply chain of each sector to meet final demand and exports but excludes emissions from production of intermediate inputs used by other sectors. Total Emissions from Consumption (TEC) includes all emissions in the supply chain of each sector to meet final demand and emissions embodied in the imports (excludes exports). For each country, the sum of DEP for all sectors is equal to the sum of TEP for all sectors. Whereas for the whole world, the sum of DEP, sum of TEP, and sum of TEC of all sectors of all countries are equal because everything produced in this world is consumed here only. The three different methodologies are just different ways of attributing emissions to various sectors and countries according to three different concepts.