Rashme Sehgal began her career as a poet-cum-short story writer in 1970s. She then shifted to journalism and worked with several leading newspapers including The Independent, The Telegraph and The Times of India
The Ministry of Statistics and Programme Implementation admitted in end May that unemployment was at a four-decade high. This had already been highlighted by the National Sample Survey Office’s (NSSO) job survey for 2017-18 which had shown a spike in the unemployment rate to over 6 per cent.
The NSSO stats also show that there is higher unemployment in the urban areas as compared to rural India. For the rural areas, the unemployment rate was 5.3 per cent, while in the urban areas it was 7.8 per cent.
This data was collected from 433,339 households located in both rural and urban areas. The government read Ministry of Finance has decried this data claiming this survey conducted between 2017-18 cannot be compared with previous years because they have used education as a criterion, unlike earlier surveys which had used expenditure as a hallmark.
This is the first comprehensive report on the country’s employment scenario in the Narendra Modi-led National Democratic Alliance government and assumes significance as it captures the impact of demonetisation on the domestic economy.
The reason why so much emphasis is being given to the NSSO survey is that although it paints a gloomy picture vis a vis jobs in the Indian economy, one sector which is presenting a picture of hope is India’s renewable energy sector which is growing at a fast pace. While the manufacturing sector is seeing a downward spiral, India’s green sector is offering a ray of hope with more and more companies coming up in this high investment area. (See Box: Seven Startups) Several reports brought out by international agencies confirm this trend. A report done by International Energy Agency (IEA) has predicted that India would be the fastest -growing energy consumer and market by 2040. The forecast also promises a bright scope for the renewable energy sector. This is good news for a country like India which has over 80 per cent of its workforce employed in the informal sector.
This is in line with countries across the globe gradually switching to clean energy in sync with their commitments under the Paris Agreement on climate change. Jobs in the renewable energy sector globally crossed the 10 million mark in 2017. All the countries together had created over half-a-million new jobs in the sector last year—a 5.3 per cent increase from 2016.
Though most countries are making efforts to move towards a low-carbon economy, six of them - China, Brazil, the United States, India, Germany and Japan - have created 70 per cent of jobs globally in this sector according to the findings of the report of the International Renewable Energy Agency (IRENA).
The figures show that the solar photovoltaic (PV) industry remains the largest employer of all renewable energy technologies, accounting for close to 3.4 million jobs worldwide, including 2.2 million jobs in China and 1,64,000 jobs in India. All in all, de-carbonisation of the global energy system can create up to 28 million jobs in this sector by 2050.
The IRENA report also highlighted how the costs for setting up solar PV projects have dropped by about 80 per cent in India between 2010 and 2018. India has realised that it is cheaper to build and operate solar farms than to run existing coal-fired power plants.
The growth story of the Indian solar market is remarkable because the government has failed to come up with a uniform policy. Experts have been stressing the need for a National Solar Policy but that has not come about. The cost of capital in India is also higher than in other South Asian countries. The present cost of borrowing from the current levels of 10-1 per cent need to be brought down.
The International Labour Organization in a separate report titled World Employment and Social Outlook Trends 2018 highlights that by 2022, over 300,000 people will be employed in the solar and wind industries, which is practically double of the number employed in 2009.
These workers will be working in the area of ground-mounted solar, rooftop solar and wind power projects all of whose numbers will have to increase significantly. The report further states that while India is rapidly increasing its share of renewable energy sources but still relies on coal, oil and natural gas and the related carbon emissions for 80 per cent of its electricity.
However, major expansion in the renewable energy sector could change the situation on the ground. It is keeping this in mind that India’s 12th Five-Year Plan and the Niti Aayog roadmaps have made environmental sustainability as core to India’s development strategy.
This has resulted in the setting up of a comprehensive framework for skills development for a green transition.
India has already become the world’s third biggest solar power, and has already achieved the target of 20 GW it had set for 2022. Next up, India has now set a target of achieving 100 GW in the next four years.
Given that power is a state subject, the states play a key role in promoting solar energy. The states of Karnataka and Tamil Nadu promoted open access through concessional loans and by providing banking facilities for solar. Other states including Haryana and Uttar Pradesh are expected to follow suit.
Another problem that solar energy is facing is acquiring land for projects. Acquisition of land is both time consuming and an expensive process. Since the cost of land constitutes about seven per cent of a large scale solar project, in 2016, the MNRE Solar Park Policy introduced guidelines that would help state governments help identify waste and non-agricultural land to speed up the process.
The IRENA report has shown that India has set a target of installing 175 GW of renewable power by 2022. This includes 100 GW from solar power, 60 GW from wind power, 10 GW from biomass power and 5 GW from small hydro power. India’s cumulative solar installations stand at 19.6 GW as on December, 2017. The country had added record 9.6 GW of solar power last year.
The IRENA gives specific figures to assess the number of jobs created. In all 11 million jobs were created, 3.6 million jobs in the solar PV industry, 2.1 million in biofuels and hydropower. Asia accounted for 60 per cent of these jobs of which 39 per cent were cornered by China. But renewable energy is good for women because 32 per cent of these jobs went to women. India’s largest renewable-sector employment generation was in the labour-intensive hydro-power segment, with 17 per cent of the global hydropower employment generation being from the country. India could perhaps tackle its unemployment problem via the renewable energy sector—the report puts India in the top 10 countries that are generating renewables employment. The report further highlights how the focus in solar must also be on the rooftop solar segment which is more labour-intensive as it provides around 25 jobs per year per megawatt (MW). The ground-mounted solar accounts for 3.45 job-years per MW and wind power for 1.27 job-years per MW.
All these statistics of providing three million new jobs in the next ten years add up provided 40 per cent of the country’s electricity is generated through renewables
But the key question is, is this happening on the ground? The think tank and NGO Centre for Science and Environment (CSE) has repeatedly emphasised that India needs a renewable energy policy that is less about industry and more about ensuring supply to meet the needs of the poorest in the country. It should be a means to both de-carbonise the economy and provide access to large numbers of people who are energy-deprived. Renewable energy is not just another infrastructural challenge, rather this sector is important to achieve the challenges of the modern era the CSE Director General Sunita Narain has repeatedly emphasised.
The reality of energy deprivation was highlighted by Upendra Tripathy at an International Solar Alliance meet when he stressed that 600 million people would not have access to energy even in 2040. A large number of these are in India.
Priyavrat Bhati, advisor, Energy Group, CSE, said that renewable energy received a boost in 2015 when India decided to install 175 GW capacity of such energy by 2022, but the momentum seems to be slowing down.
Bhati believes that inconsistent policies in this sector have been one of the biggest problems faced by the renewable energy sector especially when it is seeking to attract global investors.
The CSE’s 2019 State of Renewable Energy report emphasises that while there is no doubt that renewable energy (RE) has expanded and is looking to provide 20 per cent of the country’s installed capacity for power generation but it has not grown to the extent that it should have. The report highlights some of its limitations.
First, there is the challenge of access to energy. The fact is that even as the grid reaches everywhere, the light does not. Whatever the reason, millions in the country are still in darkness. Second, there is the challenge of clean cooking energy. Women, across the developing world, continue to be exposed to toxic emissions because of the biomass they burn to fuel their cooking stoves.’
Other challenges are the facts that the world and India remain addicted to fossil fuels. How can it replace coal and yet provide this energy security? That is the key challenge for which there are no easy answers.
The other important and corresponding message is how to integrate green skills in formal education and training programmes. Thailand provides a good example of this, having forged ahead by training people in constructing green buildings and other green skill competencies in the construction trade.
India has failed to develop a curriculum in the area of technical and vocational education run by the government which is in alignment with the needs of the market. The Indian government has seventeen ministries engaged in providing educational and technical training which is not in alignment with the needs of the industry. People coming out of these institutes are simply not trained.
The Prime Minister’s Skill India Mission is one such example of failure. Although it had a kitty of Rs 12,000 crore funding from the government, the programme called the Pradhan Mantri Kaushal Vikas Yojana was a disaster because although it trained over 41 lakh persons in the past three years only 6.15 lakh people managed to get jobs as revealed by Dharmendra Pradhan, Minister of Skill Development, informed Parliament, which makes it a placement rate of 15 per cent. This happened largely because many of these youth were not trained according to the needs of the industry.
The Ministry of Environment, Forest and Climate Change has also launched a Green Skill Development Programme (GSDP) which aims to train over 550,000 people in the environment and forest sectors in the next three years so that they can get employment in these sectors. But here again these programmes must partner with the private sector so that their syllabi and training incorporates the needs and requirements of prospective employers.
India’s plans of reaching 100 Gigawatt (GW) of solar installations by 2022 may fall short of the target by almost 30 per cent, unless further aggressive incentives are offered and focus is given more on rooftop installations.
Despite the hype and incentives, solar installations in the country are slowing down. Though the first quarter of 2019 saw a 4 per cent jump in installations to 1,737 MW, when compared to the 1,638 MW installed in Q4 2018 it was down 49 per cent compared to 3,377 MW added in the first quarter of 2018.
Another problem looming large in the renewable energy sector is the Andhra Pradesh government’s decision to review and bring down the purchase cost of wind and solar energy as this could cause financial trouble for 5.2 GW of renewable projects with estimated debt exposure of over Rs 21,000 crore. Of this, Rs 10,600 crore worth of projects may be at a higher risk of default pointed out the rating agency Crisil.
If a similar decision is taken by other states, it could prove a serious blow to this section of RE. Thanks to the central government’s push for renewables with a target of 175 GW renewable capacity by fiscal 2022, investments in the country’s renewable energy sector had doubled over the last five years to around $20 billion in 2018. But to reach these targets, it will require further investments of around $80 billion till 2022. By May 2019, utility solar installations were over 27 GW and wind 36 GW of wind energy. Raising money for these projects will prove a gigantic task. But there is no doubt we need to come up with sustainable practices for this green economy to take roots at the grass root level. Transition to the green economy needs investment. It needs consistent policies. It is only when all these policies and practises are in place that we will see major job increases and more sustainable environmental practices in place.