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India: The new global green hydrogen powerhouse? (III/III)

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By Nicola de Blasio, Alessandro Gili

· 5 min read

This is part three of a three-part series. You can find part one here, and part two here.

India’s growing population and fast-paced economy are skyrocketing demands for energy, enabling infrastructure, and new manufacturing capacity. Today, India is the world’s third-largest carbon dioxide emitter after China and the United States. Continued reliance on fossil fuels would exacerbate existing socioeconomic imbalances, as worsening pollution and rising carbon emissions would severely impact the Indian populace through extreme events and pollution-related diseases, particularly among the most vulnerable; these events would also have significant adverse economic impacts. 

Considering these circumstances, a critical question emerges: how can India balance sustaining growth and achieving prosperity for all while accelerating the transition to a low-carbon economy? 

Executive summary

India aims to become a leading powerhouse in green hydrogen production by the next decade as part of a broader industrial strategy to achieve a $5 trillion GDP economy by 2028. Hence, India must develop new approaches to produce vast amounts of green energy at affordable prices to support its economic development, growing population, and carbon reduction targets. Neither the public nor the private sectors can address these challenges alone, and technological innovation must increasingly play a role.

To achieve its ambitious goals, New Delhi must incentivize the creation of fully-fledged green hydrogen industrial value chains (such as fertilizers and steel), which includes scaling up domestic electrolyzer manufacturing capacity.[1] This strategy will avoid the inefficiencies and mistakes of the past, during which dependence on foreign manufacturing (i.e., Chinese solar technology) undermined the country’s ability to deploy robust industrial clean technology value chains at scale. To accelerate the development and deployment of hydrogen value chains, the Indian Government must design appropriate incentives to drive adoption while supporting workforce development.

However, our research demonstrates how land availability, water scarcity, and infrastructure challenges could limit India’s ability to become a green hydrogen export champion.[2] These factors would require India to produce hydrogen in less densely populated areas and efficiently transport it to demand or export centers. However, these regions also face higher infrastructure gaps.[3] Successfully tackling these hurdles while establishing a business-friendly regulatory framework - to mobilize the necessary private investments - would allow India to corner new green hydrogen markets connecting the Middle East, Europe, and other key countries in the Global South.

As witnessed during the G20 presidency, India could pioneer a new economic development model based on technological innovation, thereby side-stepping the carbon-intensive approaches of the past. Accelerating the transition to a low-carbon economy should not be perceived as a risk hindering growth but as an opportunity to reduce socioeconomic imbalances and achieve industrial leadership. Is India ready?

Policy recommendations

To validate its geopolitical and economic leadership aspirations, India must navigate the delicate balance of sustaining economic growth while achieving prosperity for all. The case of hydrogen highlights how adopting new clean technologies can offer unique opportunities to accelerate the transition to a low-carbon economy. Still, deployment at scale faces significant challenges that neither the private nor the public sectors can address alone. 

Despite these challenges, India has an important opportunity to become a global leader in fighting climate change. Success is possible, but it will require a concerted effort to:

• Prioritize detailed analysis and planning now since the effects of policy choices made today will be felt decades in the future. As our research highlights, nations must consider their role in future low-carbon value chains from a geopolitical and market perspective. 

• Support research and development efforts and public-private partnerships to accelerate innovation cycles - including training the needed workforce. 

• Convene stakeholders across value chains and foster collaborations that address first-mover risks, strategic barriers, and opportunities. This will also require rationalizing responsibilities between the Central Government and States to streamline authorization procedures. 

Identify infrastructure bottlenecks and address financial gaps in specific sectors and applications. Synchronizing infrastructure investments with growth in supply and demand will be essential but challenging. 

Prioritize projects that can exploit economies of scale, including scaling up domestic electrolyzer manufacturing capacity. Pilot hydrogen facilities should be established in industrialized coastal areas with developed port infrastructure and high renewable energy potentials. 

Invest in electricity grid infrastructure to stabilize the Indian energy market and better match offers and demand across the country. 

Address the price gap between green and fossil-based hydrogen through active policy interventions. Such policies could include measures to incentivize the value and use of green hydrogen, such as implementing clean hydrogen standards and carbon pricing. 

Leverage India’s geopolitical multi-alignment approach to its global “hydrogen diplomacy” and drive market-aligning policies and production/ safety standards to accelerate adoption and transnational trade. 

Accelerating the transition to a low-carbon economy should not be perceived as a risk hindering growth but as an opportunity to reduce socioeconomic imbalances and achieve industrial leadership. Is India ready?

This article is part of a full report. illuminem Voices is a democratic space presenting the thoughts and opinions of leading Sustainability & Energy writers, their opinions do not necessarily represent those of illuminem.

References and notes

[1] See Lalwani A. (2023), India’s leadership in green hydrogen will be decided by its leadership in the electrolyser, ORF 

[2] Eicke, L., and De Blasio, N. (2022) “Green hydrogen value chains in the industrial sector— Geopolitical and market implications,” Energy Research & Social Science 93, 102847 

[3] Pflugmann, F., and De Blasio, N. (2020) “The Geopolitics of Renewable Hydrogen in Low-Carbon Energy Markets,” Geopolitics, History, and International Relations 12(1): 9–44. 


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About the authors

Nicola de Blasio leads Harvard Kennedy School’s Belfer Center research on energy technology innovation and the transition to a low carbon economy. Nicola is an expert in navigating the challenges of strategic development toward sustainable commercial success. He serves as board member and adviser to various companies and startups and is also Senior Associate Research Fellow at the Institute for International Political Studies (ISPI). Previously, he was a Senior Research Scholar in the faculty of SIPA at Columbia University, Program Director of Technology and Innovation at the Center on Global Energy Policy, and Vice President and Head of R&D International Development at leading energy company ENI.

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Alessandro Gili is a Research Fellow at the ISPI Centre on Geoeconomics (supported by Intesa Sanpaolo) and at the Centre on Infrastructure. He also worked as a Researcher at LUISS Research Centre on International and European Organizations, with a focus on economic issues. He was member of the T20 Task Force on Infrastructure Investment and Financing during the G20 Italian Presidency in 2021.

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