India is challenged by the need to make significant investments to achieve its 2070 net-zero emissions goal, Moody's Ratings stated on Wednesday.
The report emphasized the key role of the power sector, which accounts for a large proportion of India's carbon footprint, in this transition.
Across the next ten years, investment in the value chain of electricity—encompassing generation, storage, transmission, and distribution—is likely to be around 2% of India's real GDP. This is according to the government's intention to transition from a coal-based fuel mix to renewable and clean energy.
Even so, robust economic growth will also propel a 32-35% expansion in coal-based power capacity, with about 70-75 GW of additional capacity in the next decade, as well as around 450 GW of renewable energy capacity.
Moody's Vice President Abhishek Tyagi pointed out that the private sector would remain an active driver of renewable energy growth, supplemented by increased activity by government enterprises. Solar and wind energy would dominate capacity additions, with lesser inputs from nuclear and hydropower.
The report underscored mobilization of various sources of capital—foreign equity and debt investments—to fill the finance gap for India's energy transition infrastructure.
Independent of this, Moody's Indian unit ICRA has estimated 3-5% cargo volume growth in FY26, led by container, petroleum, and fertilizer segments, fueled by the government's 'Maritime India Vision 2030' that aims at major port capacity expansion.
Moreover, the data center space is becoming a new infrastructure investment destination, with ICRA pegging the investment pipeline for capacity addition over the next 5-6 years at Rs 1.6-1.8 trillion, driven by increasing digitalization and favorable policies.
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