India needs more than Rs 9 trillion (USD140 billion) a year to 2040 in investment to meet its rapidly growing energy needs and its development ambitions, said International Energy Agency (IEA).
The energy agency also said that the country needs around Rs 7 trillion ($110 billion) per year in energy supply. The 75% of this enery supply is required to meet the country's burgeoning need for electricity and a further Rs 2 trillion ($30 billion) per year to improve energy efficiency.
Fatih Birol, IEA Executive Director said, "India's energy transformation requires three things and that is investment, investment and investment. A lot is being done already to overhaul the energy regulatory system and get the incentives in place; this is vital, as India will need to call upon a wider range of investors and sources of finance than it has in the past."
"Taking into account the achievement of universal electricity access and anticipated demographic trends that will make India the most populous country in the world, India has to make provision for nearly 600 million new electricity consumers by 2040," noted the energy agency.
IEA said, "The "Make in India" programme that aims to transform Indian into a manufacturing powerhouse can help modernise the economy and create jobs for the growing workforce, and also has major implications for energy use."
"India's climate pledge is a beacon for the cleaner path that India intends to follow, highlighting to the world that economic growth and social transformation can be pursued with a regard for the wider environment," said Birol.
A slew of recent policy initiatives aimed at improving the business environment and attracting investment point to a growing momentum that will need to be sustained. Rising incomes and population, increased access to electricity and clean cooking facilities, urbanisation and industrialisation are the key factors underpinning the rise in energy demand.
A large share of India's future industrial and transport infrastructure, as well as around three-quarters of anticipated 2040 buildings stock, is yet to be built: stringent energy efficiency policies offer India a tremendous opportunity to ensure that future demand for energy services is met without undue strain on energy supply or the environment.