India's Renewable Energy Revolution: Balancing Financial Prudence with Strategic Climate Ambitions

Key Highlights

• Scale and Growth: India's renewable capacity reached 220.10 GW with 29.52 GW added in FY 2025, requiring $400 billion investment through 2030 to achieve 500 GW target by 2030

• Public-Private Convergence: VGF schemes provide up to 40% project cost support, PLI allocated ₹24,000 crore for solar manufacturing, while international investors contributed 50% of renewable project debt during 2019-2021

• Manufacturing Self-Reliance: Solar module capacity doubled from 38 GW to 74 GW in FY 2025, PV cell capacity tripled to 25 GW, with ALMM ensuring domestic content requirements for government projects

• Employment Generation: PLI investments of $4.8 billion created 11,650 direct jobs, while renewable sector expansion is projected to generate significant employment across manufacturing, installation, and operations

• Financial Challenges: Annual funding gap of ₹8.3 lakh crore for climate action, with only 34% of public sector banks actively supporting renewable energy, requiring innovative financing mechanisms

 

India's renewable energy transformation represents one of the world's most ambitious clean energy transitions, where public-private funding convergence, climate commitments, and industrial policy create a complex ecosystem demanding both financial prudence and strategic vision. With 220.10 GW of renewable capacity as of March 2025 and targets of 500 GW by 2030, India's approach exemplifies how emerging economies can balance immediate economic realities with long-term sustainability goals.

Context: India's Renewable Energy Landscape

Scale and Ambitions

India's renewable energy journey reflects unprecedented scale and ambition. The country added 29.52 GW renewable capacity in FY 2024-25, with solar energy contributing 23.83 GW. This growth trajectory positions India as the 4th globally for renewable power capacity and 5th in solar power capacity.

The "Panchamrit" commitments announced at COP-26 establish India's climate framework: 500 GW non-fossil energy capacity by 2030, 50% energy requirements from renewables, 45% carbon intensity reduction, and net-zero emissions by 2070. These targets require $400 billion in financing through 2030, creating massive opportunities for public-private collaboration.

Economic Significance

Renewable energy's economic impact extends beyond electricity generation. The sector attracted $19.98 billion FDI during April 2020 to September 2024, with 100% FDI permitted under automatic route. Solar manufacturing capacity nearly doubled from 38 GW to 74 GW in FY 2025, while PV cell capacity tripled from 9 GW to 25 GW.

Employment generation represents a crucial economic dimension. The renewable sector creates large numbers of domestic jobs across manufacturing, installation, and operations. Under the PLI scheme for high-efficiency solar modules, investments totaled $4.8 billion, creating 11,650 direct jobs.

India’s Energy Transition: Policy, Progress, and the Path to Net Zero

 Key Highlights

• India targets 500 GW non-fossil capacity by 2030, led by solar and wind.

• Policy levers—transmission-charge waivers, Renewable Energy Certificates, Green Hydrogen Mission—cut costs and spur investment.

• Grid integration, large-scale storage, and discom finances remain pressing hurdles.

• Diversified energy mix supports energy security while meeting Net Zero 2070 pledges.

• Lessons from global peers guide India’s next phase of sustainable growth.

Rainwater Harvesting: Climate-Proofing India’s Water Security

 Key Highlights

• Rainwater harvesting (RWH) addresses urban floods, erratic monsoons, and groundwater decline.

• SDG 6 mandates integrated water resource management for clean water and sanitation.

• Enforcement gaps, planning deficits, and inequitable access hinder RWH.

• Atal Bhujal Yojana and decentralized practices bolster groundwater resilience.

• Community-led watershed management and traditional methods form the way forward.

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Introduction

India’s intensifying monsoon variability—marked by urban floods and prolonged dry spells—coupled with a sharp fall in groundwater levels, has placed rainwater harvesting (RWH) at the forefront of climate adaptation, sustainable agriculture, and SDG 6 (Clean Water & Sanitation). This essay examines the contextual drivers, analyzes the policy and implementation challenges, and outlines strategic interventions to mainstream RWH as a pillar of India’s water security.

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Context

Urban Floods and Erratic Monsoons

In June–July 2024, Assam experienced catastrophic floods affecting 400,000 people and displacing 14,000 as rivers like the Brahmaputra overflowed; similar events in Uttar Pradesh and Himachal Pradesh compounded losses and infrastructure damage. Unplanned urbanisation and outdated drainage intensify flood risks, overwhelming stormwater systems designed for 50 mm/day when cities now witness 100–185 mm/day during extreme events.

Groundwater Decline

India extracts more groundwater than any other nation, with declines exceeding 1 m/year in the Indo-Gangetic plains. Over-exploitation has led to seasonal aquifer drying and reduced availability for irrigation, threatening food security.

SDG 6 Imperative

SDG 6 calls for universal and sustainable access to water and sanitation by 2030, emphasizing integrated water resources management (IWRM). RWH directly contributes to Targets 6.4 (water-use efficiency) and 6.6 (ecosystem protection), thus aligning national efforts with global commitments.

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Analysis

1. Policy and Regulatory Enforcement

Despite state-level RWH mandates in urban bylaws and national guidelines, enforcement remains weak. Many municipal corporations lack routine inspections and penalties for non-compliance. Moreover, rainwater rules are rarely integrated into master plans, leading to piecemeal adoption.

2. Urban Planning Integration

Cities often view RWH as an add-on rather than a core infrastructure component. Absence of RWH corridors in zoning regulations and lack of incentives for retrofitting heritage and high-rise buildings create missed opportunities for large-scale storage.

3. Equity and Access

High-income neighbourhoods implement luxury rainwater gardens and rooftop tanks, while informal settlements lack basic storage, perpetuating water insecurity. Gendered burdens—women and girls fetching water—intensify in low-access areas, undermining SDG 6’s equity goals.

4. Case Study: Rajasthan’s Johad Revival

Villages in Alwar district revived johads (earthen check dams), raising water tables by 3–4 m over five years. Local governance and NGO partnerships demonstrate how traditional structures can be scaled under decentralized schemes.

5. Role of Atal Bhujal Yojana

Atal Bhujal Yojana (ABY) is a World Bank-backed, community-led groundwater management programme in 229 blocks across seven states, linking performance-based funding to groundwater level improvements. As of March 2025, 83 of 229 blocks recorded rising water tables, showcasing demand-side interventions and community water budgeting.

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Way Forward

A. Strengthen Enforcement and Governance

1. Mandatory RWH audits for all large-scale developments with penalties integrated into municipal property taxes.

2. Incentive structures—subsidies or expedited approvals—for retrofitting existing buildings.

B. Integrate RWH into Urban Planning

• Incorporate Green-Grey Infrastructure: Combine permeable pavements with underground storage to mitigate floods and recharge aquifers.

• Embed RWH in City Development Plans (CDPs) and revise building codes to mandate minimum storage per square metre of built-up area.

C. Promote Equity through Decentralization

• Deploy community-managed tanks in informal settlements and peri-urban areas, ensuring local ownership and maintenance.

• Empower women’s water committees to oversee RWH installations, aligning with SDG 6’s focus on gender-responsive solutions.

D. Leverage Traditional Knowledge

• Scale up structures like baolis, tanks, and kunds under MGNREGA and watershed schemes to revive local hydrology.

• Document and disseminate best practices via Atal Jal Portal.

E. Enhance Capacity Building and Awareness

• Integrate RWH modules in school curricula, vocational training, and local governance workshops.

• Use IEC campaigns and digital platforms to share real-time recharge data, fostering transparency.

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Conclusion

Rainwater harvesting transcends mere conservation—it is a climate-proofing strategy essential to India’s water security. By addressing enforcement gaps, embedding RWH in planning, promoting equitable access, and leveraging both modern and traditional practices, India can adapt to monsoon variability, reduce flood impacts, and achieve SDG 6. The synergistic application of programmes like Atal Bhujal Yojana, decentralized storage, and community stewardship will ensure resilient water systems for generations to come.