KPMG Report Highlights Massive Opportunities and Challenges
KPMG in India has released a report titled “Pivoting to Leadership – Re-imagining supply chains for India’s emergence as a credible alternative for global clean energy manufacturing.” The report, launched by Hon’ble Minister Shri Hardeep Singh Puri, Minister of Petroleum & Natural Gas and Housing & Urban Affairs, Government of India, emphasizes the importance of India’s role in the global energy transition.
Here are the key highlights from the report:
- Massive Investment Opportunity: The global shift towards clean energy offers a substantial investment opportunity. An estimated annual investment of USD 4.5 trillion in energy transition until 2050 is required due to rapid growth and climate change.
- India’s Clean Energy Ambitions: India’s expanding population and infrastructure development initiatives necessitate fast-tracking its energy transition, requiring an average annual investment of USD 350-400 billion by 2047.
- Reimagining Supply Chains: A critical aspect of successful energy transition is reimagining supply chains. Overreliance on a single country poses risks to global renewable energy capacity deployment, emphasizing the need for diversified supply chains.
- Clean Technology Manufacturing Opportunity: India is positioned as a strong contender in clean technology manufacturing, with a potential cumulative market opportunity of USD 300-400 billion by the end of this decade. Factors such as high captive demand, government support, regulatory enablers, and skillsets make India attractive in this space.
- Global Energy Transition Support: India, situated between Europe and China, has the potential to support the global energy transition. The industry needs to focus on value engineering, expansion management, and other strategies to strengthen its manufacturing and sourcing.
- Challenges and Opportunities: While India has strengths in its supplier ecosystem and collaborations, there are areas for improvement, including R&D, innovation, and financing. Addressing these challenges could enable India to become a more reliable source for high-quality clean energy products.
- Economic Opportunity: A transition to clean energy presents a significant economic opportunity for India, addressing its energy needs and reducing vulnerability as a large energy importer.
- Job Creation: Energy transition in India could create 5-6 million jobs by 2030 and 9-10 million jobs by 2047, with approximately 30% in manufacturing. Skilling strategies and talent development are crucial to meet this demand.
Overall, the report emphasizes the need for India to focus on manufacturing, supply chain, innovation, and policy strategies to harness its potential as a global leader in clean technology manufacturing and support the worldwide energy transition.