NEW DELHI – It took less than two weeks for TotalEnergies SE to put a massive green hydrogen project with Adani Group on hold after the Indian conglomerate was rocked by allegations of fraud.
Energy transition investments in India already lag behind other major nations, and now the cost of capital is increasing as global interest rates rise, while the Inflation Reduction Act is creating more opportunities for clean-power investors in the US and its free-trade partners. The multiplying headwinds are making the government’s goal of tripling clean electricity capacity by the end of the decade less achievable. New Delhi wants to increase the current 169 gigawatts to 500 gigawatts by 2030, taking its percentage of the total from 41 per cent to almost two-thirds, a key milestone en route to net zero by 2070.
Fiscal incentives such as the IRA are drawing a lot of capital that could have potentially found its way to India, said Ms Anita George, the co-founder of Edhina Capital, an Indian private equity firm looking to invest in clean energy, mobility, green buildings and recycling opportunities. “That has been a dampener for all the emerging markets, not just India.”