The Budget focus on MSME, energy security and innovation can translate into a green economy thrust. Many think of a green economy only as an energy-centric transition from fossil fuels to renewables. But the opportunities are much greater if we can start reshaping not just the energy India consumes but also the materials it uses.
For instance, transitioning from minerals and chemicals to bio-based and compostable materials — across pharma, polymers, packaging materials, cleaning agents, etc — offers new ways to boost agriculture and rural prosperity by tapping into the immense potential of a bio-economy. Feedstock such as seaweed, algae, and natural fibres could replace conventional materials, enabling sustainable packaging, bio-based construction materials, and bio-enzymes as fertilizers for agricultural applications. However, many of these emerging areas have not received enough attention because of the common notion that sustainability is not economically rewarding.
Economic potential
Challenging the notion, a recent study by the Council on Energy, Environment and Water (CEEW) highlights the vast economic potential of implementing a green economy. In Odisha, for instance, 28 value green chains, across circular economy, bio-economy and nature-based solutions, and energy transition, could add ₹2 lakh crore to the State’s GDP, attract ₹3.5 lakh crore in investments, and create 10 lakh new full-time equivalent jobs by 2030. This is just one example of the transformative potential of the green economy, even in a region dependent on primary sectors. As the global demand for green products grows, India can seize the opportunity to boost its exports in a timely manner. To realise this green opportunity, the government, markets, and civil society must work together.
First, the government must lead by creating an enabling ecosystem for green growth. Through tax holidays and single-window clearance for green industries, the government could incentivise green investments. Next, as large demand generators themselves, the Central and State governments must shift public procurement to prioritise green products and services, thereby de-risking early-stage commercialisation of green solutions — especially for MSMEs. For instance, the government can give strong demand signals by prioritising bamboo-based furniture in all new public buildings. Additionally, the government’s own innovation programmes — such as the Atal Innovation Mission or the Biotechnology for Economy, Environment and Employment scheme — must extend their focus to green technologies.
Existing schemes could also be reoriented towards green economic activities, enabling a nimble and budget-efficient way forward.
Second, the private sector must seize the massive green economic opportunity by leading innovation and investment. Indian businesses have historically focussed on incremental improvements such as process efficiency to reduce their environmental footprint, but the time has come to evolve the core products and services to greener offerings. A great example is the automobile sector’s ongoing transition to electric vehicles (EVs) in India. Similarly, industries such as plastics, polymers, chemicals, and fertilizers must shift towards bio-based materials.
Third, civil society must play a catalytic role in both shaping and safeguarding a green economy. Many green value chains — from eco- and agro-tourism to bio-economy feedstock — require community capacity development. Civil society organisations (CSOs) could bridge this gap by training local communities and integrating these opportunities into development plans. CSOs such as think tanks must act as watchdogs against greenwashing.
Abhishek is a Director, and Gunjan is a Programme Lead, at CEEW. Views are personal