Input-output and structural decomposition analysis of India’s carbon emissions and intensity, 2007/08 – 2013/14

Abstract

India is the second largest developing country and fourth largest carbon emitter in the world. It has registered the rapid economic growth (7–9%) in the last decade. However, both its total carbon emissions and emission intensity (CO2 emissions per GDP) kept increasing during period 2007–2013. There are few studies using input-output (I-O) analysis for India’s energy/emissions in the literature. This paper tries to fill in the gap by using I-O framework to study India’s total emissions and intensity changes and its driving forces with the latest data available and newly proposed techniques. The results show that India’s carbon emission were mainly driven by private consumption (50–55%), followed by investment (25–26%) and exports (14–19%). During period 2007/08–2013/14, India’s total emissions increased by 56.6%, where total final demand change resulted in emissions increasing and the shift of demand from raw material industry to high-value added manufacturing industry helped to reduce the emissions. When measuring India’s relative emission efficiency, its aggregate embodied intensity (AEI) indicator in aggregate was mainly determined by private consumption (47–49%), followed by investment (23–24%) and exports (15–18%). From 2007/08 to 2013/14, the AEI values in aggregate and by final demand category all increased except the AEI of inventory change, mainly caused by production structure change. The emission efficiency improvements helped to reduce India’s total emissions and carbon intensity, but the contributions were small. The policy implications of our findings are also discussed.