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New Delhi: Climate action is no longer an environmental add-on but a core component of India's development strategy, and with the global north dithering on their own climate action, the country must ensure that development gains are not lost, according to the Economic Survey 2025-26.
India has not yet reached its peak energy demand, and ensuring energy access, affordability, and security remains central to its development pathway but raising climate ambition in India, especially on mitigation, without corresponding support in finance and technology is neither realistic nor equitable, said the pre-Budget document document tabled in the Lok Sabha.
Also Read: Economic Survey 2026- India's recent trade triumphs to fuel its growth powerhouse
With India aiming to become a developed nation by 2047, the survey noted that it would require achieving high, inclusive, and environmentally sustainable growth.
"This will necessitate a transformation in consumption and production patterns, as well as technological and policy reforms," it said.
Although India's per capita emissions remain well below the global average, climate change poses risks to livelihoods, infrastructure, and economic stability, the survey said, adding, "Adaptation is, therefore, central to India's climate strategy, driven primarily by public investment and community-based action."
Asserting that "climate action is no longer an environmental add-on but a core component of India's development strategy", the survey said, "For India, adaptation has rightly emerged as the cornerstone of climate-resilient growth, delivered primarily through public investment, state-led planning, and community institutions."
Also Read: Economic Survey- Deeper financialisation drives India’s housing demand as loans hit Rs 37 lakh cr
The survey said India is pursuing a balanced mitigation pathway, scaling renewables, battery storage, and nuclear energy in line with the objective of energy security and industrial competitiveness.
"However, inadequate global capital flows to developing countries remain a significant constraint, underscoring the need to reform multilateral financial institutions and to strengthen domestic financial systems," it said.
Hitting out at developed nations for their lackadaisical attitude towards climate commitments, the survey said,"Even the new NDCs (Nationally Determined Contributions) for 2035 of major developed economies show only limited enhancement in their climate mitigation goals, backpedalling on their commitments under the Paris Agreement, despite the fact that these countries reached their peak emissions decades ago, vis-A -vis developing countries like India."
It further said to add to the weakening of global efforts against climate change, the climate finance commitments to the developing countries continue to remain diluted.
"The clear signals from the global north, which are dithering on their own climate action, warrant that India must place adaptation centre stage in India's climate action story to ensure that development gains are not lost," it asserted.
It, however, said, "Raising climate ambition in India, especially on mitigation, without corresponding support in finance and technology is neither realistic nor equitable."
A credible and orderly transition from fossil fuels depends on the timely availability of reliable, non-fossil energy sources such as nuclear power, alongside a well-defined peak-emissions pathway, the survey said.
It suggested a push towards establishing a credible national platform, backed by predictable and adequate international finance, that can help India develop climate projects, enhance their bankability, and enable the required climate action.
Stating that climate finance remains the binding constraint, the survey said the gap between global capital availability and climate investment needs in developing countries reflects structural weaknesses in the international financial architecture rather than a lack of ambition or bankable projects.
While India's experience highlights the importance of robust domestic financial markets, strong development banks, effective municipal finance, and credible regulatory frameworks, the survey however, said domestic resources alone cannot meet the required investment scale.
Noting that environmental regulation is increasingly becoming a facilitator of sustainable growth, the survey said,"India's thoughtful transition toward risk-based regulation, market-oriented instruments, digital compliance systems, and a framework of trust-based governance highlights the potential for environmental protection to coexist harmoniously with improved business operations."
India has not yet reached its peak energy demand, and ensuring energy access, affordability, and security remains central to its development pathway but raising climate ambition in India, especially on mitigation, without corresponding support in finance and technology is neither realistic nor equitable, said the pre-Budget document document tabled in the Lok Sabha.
Also Read: Economic Survey 2026- India's recent trade triumphs to fuel its growth powerhouse
With India aiming to become a developed nation by 2047, the survey noted that it would require achieving high, inclusive, and environmentally sustainable growth.
"This will necessitate a transformation in consumption and production patterns, as well as technological and policy reforms," it said.
Although India's per capita emissions remain well below the global average, climate change poses risks to livelihoods, infrastructure, and economic stability, the survey said, adding, "Adaptation is, therefore, central to India's climate strategy, driven primarily by public investment and community-based action."
Asserting that "climate action is no longer an environmental add-on but a core component of India's development strategy", the survey said, "For India, adaptation has rightly emerged as the cornerstone of climate-resilient growth, delivered primarily through public investment, state-led planning, and community institutions."
Also Read: Economic Survey- Deeper financialisation drives India’s housing demand as loans hit Rs 37 lakh cr
The survey said India is pursuing a balanced mitigation pathway, scaling renewables, battery storage, and nuclear energy in line with the objective of energy security and industrial competitiveness.
"However, inadequate global capital flows to developing countries remain a significant constraint, underscoring the need to reform multilateral financial institutions and to strengthen domestic financial systems," it said.
Hitting out at developed nations for their lackadaisical attitude towards climate commitments, the survey said,"Even the new NDCs (Nationally Determined Contributions) for 2035 of major developed economies show only limited enhancement in their climate mitigation goals, backpedalling on their commitments under the Paris Agreement, despite the fact that these countries reached their peak emissions decades ago, vis-A -vis developing countries like India."
It further said to add to the weakening of global efforts against climate change, the climate finance commitments to the developing countries continue to remain diluted.
"The clear signals from the global north, which are dithering on their own climate action, warrant that India must place adaptation centre stage in India's climate action story to ensure that development gains are not lost," it asserted.
It, however, said, "Raising climate ambition in India, especially on mitigation, without corresponding support in finance and technology is neither realistic nor equitable."
A credible and orderly transition from fossil fuels depends on the timely availability of reliable, non-fossil energy sources such as nuclear power, alongside a well-defined peak-emissions pathway, the survey said.
It suggested a push towards establishing a credible national platform, backed by predictable and adequate international finance, that can help India develop climate projects, enhance their bankability, and enable the required climate action.
Stating that climate finance remains the binding constraint, the survey said the gap between global capital availability and climate investment needs in developing countries reflects structural weaknesses in the international financial architecture rather than a lack of ambition or bankable projects.
While India's experience highlights the importance of robust domestic financial markets, strong development banks, effective municipal finance, and credible regulatory frameworks, the survey however, said domestic resources alone cannot meet the required investment scale.
Noting that environmental regulation is increasingly becoming a facilitator of sustainable growth, the survey said,"India's thoughtful transition toward risk-based regulation, market-oriented instruments, digital compliance systems, and a framework of trust-based governance highlights the potential for environmental protection to coexist harmoniously with improved business operations."
