GS Paper 3

Context

Recently, the Government of India reduced the stock limits of raw jute for traders and balers to zero. This step is aimed at preventing hoarding, stabilizing prices, and ensuring sufficient supply of raw jute to the domestic jute industry, particularly jute mills that depend on consistent raw material availability.

About Jute Crop

Jute is the second most important natural fibre crop in India after cotton and is popularly known as the “Golden Fibre” due to its sheen and economic value. It is biodegradable, eco-friendly, and gaining renewed importance as a sustainable alternative to plastics.

Major uses of jute include packaging materials like gunny bags and sacks, ropes, twines, carpets, rugs, tarpaulins, and industrial textiles. In recent years, decorative and lifestyle

products made of jute have also gained popularity in global markets.

The jute sector supports millions of farmers and workers, especially in eastern India, and plays a crucial role in the country’s agro-based economy.

Climatic and Agricultural Requirements

Jute is primarily a crop of humid tropical climates and requires specific environmental conditions for optimal growth. The suitable temperature range is between 17°C and 41°C. It requires around 1200 mm of well-distributed rainfall during the growing season. Relative humidity between 40% and 90% is considered ideal.

In terms of soil, fertile alluvial loamy soil, particularly in river basins, is most suitable for jute cultivation.

The cropping cycle typically involves sowing between February and March and harvesting around October. The crop matures in about 8 to 10 months. After harvesting, fibre extraction is done through a process known as retting, where plant stalks are soaked in water to separate the fibres.

Distribution of Jute in India

India is the largest producer of jute in the world, and more than 99% of its production is concentrated in five states. West Bengal is the dominant producer, contributing around 80–81% of total production. Other important states include Bihar, Assam, Odisha, and Andhra Pradesh, particularly in delta regions.

The Ganga-Brahmaputra delta region provides ideal conditions such as fertile alluvial soil, abundant water supply, and high humidity, making it the core jute-growing region.

Significance of the Recent Government Decision

The reduction of stock limits to zero has several implications. It helps prevent hoarding and black marketing, leading to price stabilization. It ensures a steady supply of raw jute to mills and protects the interests of both farmers and manufacturers. Additionally, it supports the promotion of eco-friendly packaging materials in line with sustainability goals.

However, there are certain concerns. Traders and intermediaries may face operational challenges, and effective monitoring will be required to ensure that supply chains are not disrupted.

Way Forward

There is a need to promote value-added jute products for export markets and improve retting technology to enhance fibre quality. Strengthening Minimum Support Price (MSP) mechanisms and encouraging research and innovation in jute diversification will be crucial. Integrating jute into policies aimed at reducing plastic usage can further boost its demand.

Conclusion

Jute remains a vital component of India’s agricultural and industrial landscape. The

government’s recent intervention highlights its importance in ensuring fair pricing and uninterrupted supply. With increasing global demand for sustainable materials, jute has significant potential for economic growth, environmental protection, and rural employment generation.

Introduction

Indonesia has announced the rollout of B50 biofuel, a fuel blend containing 50% palm oil-based biodiesel and 50% diesel. The decision comes amid rising global crude oil prices triggered by geopolitical tensions, particularly the Iran conflict.

The policy reflects Indonesia’s efforts to improve energy security, reduce crude oil imports, and promote clean energy. However, since Indonesia is the world’s largest exporter of palm oil, the move has major implications for global edible oil markets, especially for countries like India, which heavily depend on Indonesian palm oil imports.

What is B50 Biofuel?

B50 is a biodiesel blend consisting of:

• 50% palm oil-based biodiesel
• 50% conventional diesel

Biodiesel is a renewable fuel produced from vegetable oils or animal fats and is considered an alternative to fossil fuels.

Indonesia has gradually increased biodiesel blending targets:

• B20 → 20% biodiesel
• B30 → 30% biodiesel
• B40 → 40% biodiesel
• B50 → 50% biodiesel

The latest expansion marks one of the world’s most ambitious biofuel programmes.

Drivers Behind Indonesia’s B50 Policy

1. Reducing Crude Oil Imports

Indonesia spent nearly $7.8 billion on crude oil imports in 2025. By replacing diesel with biodiesel, the country aims to:

• Reduce import dependence
• Improve energy security
• Lower foreign exchange outflows

The urgency has increased as global crude oil prices crossed $100 per barrel due to geopolitical tensions.

2. Advancing Clean Energy Transition

The B50 programme is part of Indonesia’s broader green energy roadmap. The country also plans to introduce:

• Sustainable Aviation Fuel (SAF) from 2027
• Biofuel integration in aviation and transport sectors

This positions Indonesia as a major regional player in renewable fuel development.

3. Supporting Domestic Palm Oil Industry

Indonesia is the world’s largest palm oil producer and exporter. Increasing domestic biodiesel consumption helps:

• Absorb surplus production
• Stabilise palm oil prices
• Support farmers and plantation owners

The move is especially important as export markets face restrictions due to environmental regulations, particularly from the European Union concerning deforestation-linked imports.

Impact on Global Vegetable Oil Markets

Indonesia accounts for nearly half of global palm oil exports. Diverting a significant portion of palm oil toward biodiesel production is expected to tighten global supply.

Likely Outcomes

• Increase in international palm oil prices
• Reduced export availability
• Greater volatility in vegetable oil markets

Since palm oil is widely used in food products, cosmetics, soaps, and industrial applications, the impact may extend across sectors globally.

Implications for India

India is among the world’s largest importers of edible oils and imports more than 50% of its palm oil requirements from Indonesia.

India imports nearly $8.5 billion worth of palm oil annually, making it highly vulnerable to supply disruptions.

1. Rising Cooking Oil Prices

Reduced exports from Indonesia could increase import costs, leading to:

• Higher household expenditure
• Increased food inflation
• Rising prices of processed food products Palm oil is extensively used in:
• Cooking oils
• Packaged foods
• Bakery products
• Soaps and detergents

2. Pressure on Inflation

Edible oil inflation directly affects India’s retail inflation because cooking oil is an essential household commodity.

Higher import costs may:

• Increase Consumer Price Index (CPI) inflation
• Raise subsidy burdens
• Affect lower-income households disproportionately

3. Industrial Cost Escalation

Industries dependent on palm oil derivatives such as:

• Food processing
• Cosmetics
• Oleochemicals
• Personal care products

may face higher input costs, which could eventually be passed on to consumers.

Limited Alternatives for India

India can diversify imports toward:

• Sunflower oil from Russia and Ukraine
• Soybean oil from Argentina and Brazil

However, these alternatives face several constraints:

• Higher prices
• Limited supply volumes
• Longer supply chains
• Greater geopolitical risks

Domestic Alternative: Mustard Oil

Mustard oil serves as a domestic substitute but faces limitations:

• Region-specific consumption
• Limited scalability
• Lower production levels

Thus, replacing palm oil completely remains difficult.

Why India Depends on Vegetable Oil Imports

India’s edible oil imports stem from structural agricultural issues:

Low Oilseed Productivity

Oilseed yields per hectare remain below global standards.

Policy Bias Toward Cereals

Minimum Support Price (MSP) incentives historically favoured:

• Wheat
• Rice

This reduced incentives for oilseed cultivation.

Rising Demand

Population growth, urbanisation, and changing food habits have steadily increased edible oil consumption.

Climate Impact of Palm Oil Biodiesel

Palm oil biodiesel presents both opportunities and risks.

Positive Aspects

If produced through:

• Existing plantations
• Productivity improvements
• Sustainable practices

biofuels can reduce dependence on fossil fuels and lower emissions.

Environmental Risks

However, if biodiesel expansion causes:

• Deforestation
• Conversion of carbon-rich forests
• Habitat destruction

the environmental costs may outweigh climate benefits.

India’s Constraints in Biofuel Expansion

India faces unique challenges in expanding biofuel production:

• Limited land availability
• Lower agricultural productivity
• Food security concerns
• Water stress

Large-scale diversion of crops toward biofuel production may create trade-offs between energy security and food security.

Conclusion

Indonesia’s B50 biofuel programme demonstrates how global energy transitions can directly affect food security and inflation in interconnected economies like India. While the policy strengthens Indonesia’s energy security and supports its palm oil sector, it also tightens global edible oil supplies and raises import costs for major buyers.

For India, the development highlights the urgent need to:

• Improve domestic oilseed productivity
• Diversify import sources
• Strengthen edible oil self-reliance
• Balance climate goals with food security concerns

A long-term strategy combining agricultural reform, supply diversification, and sustainable biofuel development will be essential to reduce vulnerability to global commodity shocks.

India’s textile industry is emerging as a major global manufacturing hub due to shifting supply chains and rising international demand. However, extreme heat and climate stress are increasingly threatening worker productivity, industrial efficiency, and labour welfare. The crisis reflects the growing intersection between climate change, labour rights, and industrial sustainability.

The textile sector, one of India’s largest labour-intensive industries, employs nearly 45 million people and forms the backbone of the country’s manufacturing workforce. India also produces around 39% of the world’s cotton, making it central to global textile supply chains.

Growing Heat Stress in the Textile Sector

Extreme temperatures are emerging as a hidden “thermodynamic crisis” within textile manufacturing clusters. Factory temperatures in several industrial hubs frequently exceed 35–40°C, far above the safe working threshold of around 30°C.

According to global estimates, heat stress caused nearly 259 billion labour-hour losses annually during 2001–2020, resulting in economic losses of around $600 billion each year. In

2024 alone, heat stress reportedly caused around 247 billion labour-hour losses globally.

Studies indicate that labour productivity declines by nearly 2% for every 1°C rise in temperature, while output losses may reach around 4% during extreme heat days.

Reasons Behind the Crisis

Climate Change and Heatwaves

India is warming faster than the global average, as highlighted in the Intergovernmental Panel on Climate Change AR6 report. Frequent and intense heatwaves are increasing thermal stress in major textile hubs.

Poor Industrial Design

Many factories were built for cooler climatic conditions and lack adequate ventilation, insulation, or cooling infrastructure. Consequently, indoor temperatures become dangerously high during summer months.

Informal Labour Conditions

Over 80–90% of textile workers are employed informally without adequate labour protections, regulated breaks, or occupational heat safety measures.

Global Supply Chain Pressure

International brands impose strict production timelines and financial penalties for delays. This forces factories to continue production despite unsafe working conditions, increasing worker vulnerability.

Impact of Heat-Induced Productivity Loss

Labour and Economic Losses

Extreme heat reduces working capacity, lowers efficiency, and contributes to massive labour-hour losses, negatively affecting economic productivity.

Industrial Slowdown

Factories are often forced to shorten working hours or reduce production during peak heat conditions. In some cases, output may decline by up to 50%.

Health Risks

Heat exposure above 35°C can cause:

• Fatigue
• Dehydration
• Heat exhaustion
• Heatstroke

This significantly reduces workers’ physical capacity and increases occupational health risks.

Threat to Employment

By 2030, India may lose nearly 5.8% of total working hours due to heat stress, potentially affecting around 34 million jobs and disrupting industrial supply chains.

Key Challenges

Policy and Legal Gaps

Heat stress remains poorly recognised within labour laws and occupational safety frameworks. Existing labour codes lack clear thermal safety standards for factories.

Infrastructure Constraints

Installing cooling systems, ventilation mechanisms, and climate-resilient retrofits is expensive, especially for MSMEs operating on low margins.

Buyer-Driven Pressure

Global supply chains prioritise low-cost and fast production. Similar vulnerabilities were witnessed during the COVID-19 pandemic when international buyers cancelled textile orders worth nearly $2.8 billion, severely affecting workers and manufacturers.

Data Deficit

There is inadequate monitoring of indoor workplace temperatures, worker health indicators, and heat-related productivity losses.

Way Forward

Heat-Responsive Labour Policies

Occupational safety laws should include mandatory heat safety standards, rest breaks, hydration access, and thermal monitoring systems.

Climate-Resilient Industrial Design

Factories should adopt better ventilation, passive cooling systems, heat-resistant roofing, and energy-efficient cooling technologies.

Worker Welfare Measures

Employers should provide cooling stations, flexible working hours, protective equipment, and medical support during extreme heat periods.

Sustainable Supply Chains

Global brands must adopt responsible sourcing practices that prioritise worker welfare over unrealistic deadlines and excessive production pressure.

Data and Research

Real-time monitoring of heat stress, productivity, and worker health is necessary for evidence-based policymaking.

Conclusion

India’s textile heat crisis demonstrates how climate change is becoming an economic and labour challenge alongside an environmental issue. As India strengthens its position in global manufacturing, ensuring climate-resilient factories and protecting workers from extreme heat will be essential for sustainable industrial growth, labour welfare, and long-term competitiveness.

India is accelerating the adoption of Piped Natural Gas as a primary household cooking fuel amid concerns over disruptions in LPG imports through the Strait of Hormuz. Since nearly 90% of India’s LPG imports pass through this strategic chokepoint, the government is prioritising PNG expansion to strengthen long-term energy security and reduce dependence on imported cylinders.

Why is India Promoting PNG?

1. Energy Security

PNG reduces vulnerability to geopolitical disruptions and global fuel supply shocks by relying increasingly on domestic natural gas infrastructure.

2. Continuous Supply

Unlike LPG cylinders that depend on transportation and manual delivery chains, PNG is supplied continuously through underground pipelines, ensuring uninterrupted fuel availability.

3. Improved Safety

PNG mainly contains methane, which is lighter than air and disperses rapidly in case of leakage, reducing explosion risks in densely populated urban areas.

4. Price Stability

PNG pricing is relatively more stable than LPG because it is linked partly to domestic gas production rather than highly volatile global crude oil prices.

5. Fiscal Efficiency

Meter-based billing promotes “pay-as-you-use” consumption and helps reduce subsidy leakages, illegal diversion, and black-market practices.

Challenges Associated with PNG

Despite its advantages, PNG expansion faces multiple challenges:

• High capital costs for laying pipelines and creating city gas infrastructure.
• Low viability in sparsely populated or geographically difficult regions.
• Dependence on uninterrupted electricity for monitoring and flow regulation systems.
• Absence of physical storage buffers unlike LPG cylinders.
• Existing LPG stoves may require burner modifications due to the lower calorific value of natural gas.

Government Measures

The government has adopted several policy measures to expand PNG usage:

• Petroleum and Natural Gas Regulatory Board has mandated city gas distributors to achieve minimum pipeline coverage targets.
• Domestic gas allocation policy grants top priority to PNG and CNG sectors during shortages.
• Incentives are being offered to states promoting PNG infrastructure expansion.
• National PNG Drive 2.0 has been extended till June 2026 to accelerate household connections.

The government is also discouraging simultaneous LPG and PNG connections to prevent fuel hoarding and improve transition efficiency.

Current PNG Landscape in India

India’s city gas infrastructure has expanded rapidly:

• Domestic PNG connections: 1.65 crore
• Active connections: 1.03 crore
• CGD coverage: 307 Geographical Areas
• National gas grid: Nearly 26,000 km operational pipelines
• Additional pipeline construction: 10,000 km

PNGRB has set a target of 12.63 crore PNG connections by 2034. Maharashtra leads in active PNG users, followed by Gujarat and Delhi.

Conclusion

India’s PNG expansion reflects a strategic shift toward cleaner, safer, and more secure urban energy systems. While infrastructure and affordability challenges remain, the long-term transition toward gas-based household energy can improve energy resilience, reduce import dependence, and support India’s broader gas-based economy goals.

Introduction

India’s mining sector has witnessed a major transformation in recent years through policy reforms, digitalisation, and transparent allocation mechanisms. Reflecting this momentum, the Ministry of Mines operationalised a record 30 mineral blocks in FY 2025–26, highlighting the success of ongoing reforms aimed at improving transparency, boosting investment, and strengthening domestic mineral security.

The reforms assume greater importance as India seeks to accelerate industrialisation, energy transition, infrastructure growth, and self-reliance in critical minerals required for green technologies and advanced manufacturing.

Landscape of India’s Mining Sector

The mining sector is a crucial pillar of India’s economy and industrial development.

Economic Contribution

• The sector contributes nearly 2% to India’s GDP
• Directly employs over 1.1 million workers
• Supports industries such as:
  • Steel
  • Cement
  • Power
  • Construction
  • Renewable energy manufacturing

Odisha as the Leading Mining State

Odisha emerged as the leading mineral-producing state, accounting for over 44% of India’s mineral production value in FY 2025–26.

The state is rich in:

• Iron ore
• Bauxite
• Chromite
• Coal
• Manganese

Rising Coal Production

India’s coal production crossed the 1 billion tonne mark for the second consecutive year in 2026, reflecting increasing domestic energy demand and efforts to reduce coal imports.

Surge in Mineral Auctions

More than 200 mineral blocks were successfully auctioned in FY 2025–26, with Gujarat, Rajasthan, and Tamil Nadu leading the process.

The increase indicates:

• Strong investor participation
• Improved regulatory clarity
• Growing confidence in India’s mining sector

Key Reforms in India’s Mining Sector

1. Auction-Based Allocation System

One of the most significant reforms was introduced through the Mines and Minerals (Development and Regulation) [MMDR] Amendment Act, 2015.

The reform replaced discretionary allocation of mineral blocks with transparent e-auctions.

Significance

• Increased transparency
• Reduced corruption and arbitrariness
• Improved revenue generation for states
• Encouraged private sector participation

The reform strengthened public trust in mineral allocation processes.

2. MMDR Amendment Act, 2025

The MMDR Amendment Act, 2025 introduced regulated mineral exchanges for real-time price discovery.

Importance

• Ensures transparent mineral pricing
• Reduces market distortions
• Improves efficiency in mineral trade
• Strengthens investor confidence

The move aims to modernise India’s mineral market structure.

3. District Mineral Foundations (DMF)

District Mineral Foundations are welfare institutions funded through mining revenues.

Objective

To support socio-economic development in mining-affected regions.

Areas of Focus

• Healthcare
• Education
• Drinking water
• Skill development
• Environmental restoration

DMFs help ensure that local communities benefit from mineral extraction activities.

4. National Critical Mineral Mission (NCMM)

India launched the National Critical Mineral Mission to secure domestic supply chains for strategic minerals.

Importance of Critical Minerals

Critical minerals such as:

• Lithium
• Cobalt
• Nickel
• Graphite
• Rare earth elements are essential for:
• Electric vehicles
• Batteries
• Renewable energy
• Semiconductors
• Defence manufacturing

Objectives of NCMM

• Reduce import dependence
• Promote domestic exploration
• Develop processing capabilities
• Strengthen strategic mineral reserves

The mission supports India’s clean energy transition and technological self-reliance.

5. Rare Earth Corridors

The Union Budget 2026–27 proposed Rare Earth Corridors in:

• Odisha
• Kerala
• Andhra Pradesh
• Tamil Nadu

Purpose

To integrate:

• Mining
• Mineral processing
• Magnet manufacturing
• High-value industrial production

These corridors can position India as a major player in the global rare earth supply chain.

6. Financial Reforms in Mining Auctions

The Mineral (Auction) Amendment Rules, 2026 introduced Insurance Surety Bonds as an alternative to traditional bank guarantees.

Benefits

• Reduces financial burden on bidders
• Enhances ease of doing business
• Encourages MSME participation
• Improves liquidity in the mining sector

This reform is expected to increase competition and participation in mineral auctions.

7. Technology and Digitalisation

The National Geoscience Data Repository (NGDR) has digitised geological data and enabled AI-based subsurface modelling.

Significance

• Improves exploration efficiency
• Reduces exploration risks
• Enhances scientific mining
• Supports data-driven policymaking

Technology integration is helping India modernise its exploration and resource management systems.

Significance of Mining Sector Reforms

The reforms are important because they:

• Promote transparency and accountability
• Increase mineral production
• Attract domestic and foreign investment
• Support industrial growth
• Strengthen critical mineral security
• Create employment opportunities
• Enhance state revenues They also support the goals of:
• Make in India
• Atmanirbhar Bharat
• Green Energy Transition

Challenges in India’s Mining Sector

Despite reforms, several challenges remain:

• Environmental degradation and deforestation
• Displacement of tribal and local communities
• Delays in land acquisition and clearances
• Illegal mining activities
• Dependence on imports for strategic minerals
• Balancing development with sustainability

Addressing these concerns is necessary for achieving sustainable mining growth.

Conclusion

India’s mining reforms have significantly transformed the sector through transparent auctions, digital governance, financial innovation, and focus on critical minerals. The operationalisation of a record number of mineral blocks in FY 2025–26 reflects increasing investor confidence and policy effectiveness.

As India advances toward becoming a major manufacturing and clean-energy economy, a robust and sustainable mining sector will play a crucial role in ensuring resource security, industrial competitiveness, and long-term economic growth.

Introduction

The National Statistics Office (NSO) under the Ministry of Statistics and Programme Implementation (MoSPI) has released the 33rd edition of the Energy Statistics India Report 2026. The report provides comprehensive official data on India’s energy sector, covering

reserves, production, consumption, installed capacity, trade, and energy efficiency indicators.

The report is significant because it highlights India’s rapid growth in renewable energy while also underlining the continuing dependence on fossil fuels, especially coal. It serves as an important tool for evidence-based policymaking in the energy sector.

Key Highlights of Energy Statistics India 2026

1. Growth in Energy Supply

India’s Total Primary Energy Supply (TPES) increased by 2.95% during FY 2024–25, reaching

9,32,816 Kilo Tonnes of Oil Equivalent (ktoe). The increase reflects:

• Expanding industrial activity
• Rising urbanisation
• Growing electricity demand
• Economic recovery and infrastructure growth

India’s rising energy requirement highlights the need for secure, affordable, and sustainable energy sources.

Renewable Energy Expansion

2. Massive Renewable Energy Potential

India’s renewable energy (RE) potential is estimated at nearly 47 lakh MW. The composition includes:

• Solar Energy: ~71%
• Wind Energy
• Small Hydro Power

This demonstrates India’s strong geographical advantage in solar energy generation.

3. Regional Concentration of Renewable Potential

More than 70% of renewable energy potential is concentrated in six states:

• Rajasthan
• Maharashtra
• Gujarat
• Andhra Pradesh
• Karnataka
• Madhya Pradesh

These states are becoming major hubs for India’s clean energy transition.

4. Rise in Installed Renewable Capacity

Installed renewable energy capacity increased significantly from:

  90,134 MW (2016) to

2,29,346 MW (2025)

This represents a strong Compound Annual Growth Rate (CAGR) of 10.93%.

The growth reflects government initiatives such as:

• National Solar Mission
• PM-KUSUM Scheme
• Green Energy Corridor
• Production Linked Incentive (PLI) schemes

5. Growth in Renewable Electricity Generation

Renewable electricity generation increased from:

  1,89,314 GWh (2015–16) to

4,16,823 GWh (2024–25)

This indicates a 9.17% CAGR over the period.

The increase shows India’s gradual transition toward cleaner electricity generation.

Energy Consumption Trends

6. Rising Per Capita Energy Consumption

Per capita energy consumption increased to 18,096 megajoules per person. This reflects:

• Higher standards of living
• Industrialisation
• Electrification of rural areas
• Expansion of transport and infrastructure

Although rising energy consumption indicates economic development, it also raises concerns regarding sustainability and energy security.

7. Improvement in Power Efficiency

Transmission and Distribution (T&D) losses declined from 22% to 17%. This improvement indicates:

• Better grid management
• Modernisation of transmission infrastructure
• Increased efficiency in electricity delivery
• Reduction in power theft and leakages

Efficient electricity distribution is essential for reducing energy wastage and improving financial health of DISCOMs.

Continued Dependence on Coal

8. Coal Remains Dominant

Despite rapid renewable expansion, coal continues to remain India’s primary energy source. Coal supply increased to 5,52,315 Ktoe, highlighting continued dependence on fossil fuels. Coal remains crucial because:

• It supports base-load power generation
• India possesses abundant domestic coal reserves
• Renewable energy intermittency requires backup support

However, high coal dependence creates environmental and climate-related concerns.

Increasing Energy Demand and Financial Support

9. Growth in Final Energy Consumption

Total Final Consumption (TFC) increased by more than 30%, driven by:

• Industrial growth
• Urbanisation
• Rising manufacturing activity
• Expansion in transport and services sectors

This demonstrates India’s emergence as one of the fastest-growing energy markets globally.

10. Rising Credit Flow to Energy Sector

Credit flow to the energy sector increased more than six times from:

  ₹1,688 crore (2021) to

  ₹10,325 crore (2025)

The increase reflects growing investments in:

• Renewable energy projects
• Transmission infrastructure
• Green hydrogen
• Battery storage technologies

Significance of the Report

The Energy Statistics India 2026 report is important because it:

• Helps policymakers formulate evidence-based energy policies
• Tracks India’s progress toward climate and renewable targets
• Assists in energy planning and infrastructure development
• Supports India’s commitment under the Paris Agreement
• Provides insights into energy security and sustainability challenges

The report also reflects India’s dual challenge of balancing rapid economic growth with environmental sustainability.

About National Statistics Office (NSO)

The National Statistics Office (NSO) is India’s nodal statistical agency functioning under the Ministry of Statistics and Programme Implementation (MoSPI).

Functions of NSO

• Collection and compilation of official statistics
• Publication of GDP, inflation, employment, and socio-economic data
• Conducting nationwide surveys and statistical analysis
• Supporting evidence-based governance and policymaking

The NSO plays a vital role in ensuring reliability and credibility of India’s statistical system.

Challenges Ahead

Despite progress, India’s energy sector faces several challenges:

• Continued dependence on coal
• Storage and intermittency issues in renewable energy
• Need for grid modernisation
• High energy import dependence
• Financing requirements for green transition
• Balancing development with climate commitments

Addressing these challenges will require technological innovation, policy reforms, and international cooperation.

Conclusion

The Energy Statistics India 2026 report highlights India’s rapid progress in renewable energy expansion, improving power efficiency, and increasing investment in the energy sector. At the same time, it underscores the country’s continued dependence on coal and rising energy demand due to economic growth.

As India moves toward becoming a major global economy, ensuring affordable, secure, and sustainable energy will remain central to its developmental journey. The report provides an important roadmap for achieving energy security while supporting the transition toward a greener and cleaner future.

Introduction

The National Statistics Office (NSO) under the Ministry of Statistics and Programme Implementation (MoSPI) has released the 33rd edition of the Energy Statistics India Report 2026. The report provides comprehensive official data on India’s energy sector, covering

reserves, production, consumption, installed capacity, trade, and energy efficiency indicators.

The report is significant because it highlights India’s rapid growth in renewable energy while also underlining the continuing dependence on fossil fuels, especially coal. It serves as an important tool for evidence-based policymaking in the energy sector.

Key Highlights of Energy Statistics India 2026

1. Growth in Energy Supply

India’s Total Primary Energy Supply (TPES) increased by 2.95% during FY 2024–25, reaching

9,32,816 Kilo Tonnes of Oil Equivalent (ktoe). The increase reflects:

• Expanding industrial activity
• Rising urbanisation
• Growing electricity demand
• Economic recovery and infrastructure growth

India’s rising energy requirement highlights the need for secure, affordable, and sustainable energy sources.

Renewable Energy Expansion

2. Massive Renewable Energy Potential

India’s renewable energy (RE) potential is estimated at nearly 47 lakh MW. The composition includes:

• Solar Energy: ~71%
• Wind Energy
• Small Hydro Power

This demonstrates India’s strong geographical advantage in solar energy generation.

3. Regional Concentration of Renewable Potential

More than 70% of renewable energy potential is concentrated in six states:

• Rajasthan
• Maharashtra
• Gujarat
• Andhra Pradesh
• Karnataka
• Madhya Pradesh

These states are becoming major hubs for India’s clean energy transition.

4. Rise in Installed Renewable Capacity

Installed renewable energy capacity increased significantly from:

  90,134 MW (2016) to

2,29,346 MW (2025)

This represents a strong Compound Annual Growth Rate (CAGR) of 10.93%.

The growth reflects government initiatives such as:

• National Solar Mission
• PM-KUSUM Scheme
• Green Energy Corridor
• Production Linked Incentive (PLI) schemes

5. Growth in Renewable Electricity Generation

Renewable electricity generation increased from:

  1,89,314 GWh (2015–16) to

4,16,823 GWh (2024–25)

This indicates a 9.17% CAGR over the period.

The increase shows India’s gradual transition toward cleaner electricity generation.

Energy Consumption Trends

6. Rising Per Capita Energy Consumption

Per capita energy consumption increased to 18,096 megajoules per person. This reflects:

• Higher standards of living
• Industrialisation
• Electrification of rural areas
• Expansion of transport and infrastructure

Although rising energy consumption indicates economic development, it also raises concerns regarding sustainability and energy security.

7. Improvement in Power Efficiency

Transmission and Distribution (T&D) losses declined from 22% to 17%. This improvement indicates:

• Better grid management
• Modernisation of transmission infrastructure
• Increased efficiency in electricity delivery
• Reduction in power theft and leakages

Efficient electricity distribution is essential for reducing energy wastage and improving financial health of DISCOMs.

Continued Dependence on Coal

8. Coal Remains Dominant

Despite rapid renewable expansion, coal continues to remain India’s primary energy source. Coal supply increased to 5,52,315 Ktoe, highlighting continued dependence on fossil fuels. Coal remains crucial because:

• It supports base-load power generation
• India possesses abundant domestic coal reserves
• Renewable energy intermittency requires backup support

However, high coal dependence creates environmental and climate-related concerns.

Increasing Energy Demand and Financial Support

9. Growth in Final Energy Consumption

Total Final Consumption (TFC) increased by more than 30%, driven by:

• Industrial growth
• Urbanisation
• Rising manufacturing activity
• Expansion in transport and services sectors

This demonstrates India’s emergence as one of the fastest-growing energy markets globally.

10. Rising Credit Flow to Energy Sector

Credit flow to the energy sector increased more than six times from:

  ₹1,688 crore (2021) to

  ₹10,325 crore (2025)

The increase reflects growing investments in:

• Renewable energy projects
• Transmission infrastructure
• Green hydrogen
• Battery storage technologies

Significance of the Report

The Energy Statistics India 2026 report is important because it:

• Helps policymakers formulate evidence-based energy policies
• Tracks India’s progress toward climate and renewable targets
• Assists in energy planning and infrastructure development
• Supports India’s commitment under the Paris Agreement
• Provides insights into energy security and sustainability challenges

The report also reflects India’s dual challenge of balancing rapid economic growth with environmental sustainability.

About National Statistics Office (NSO)

The National Statistics Office (NSO) is India’s nodal statistical agency functioning under the Ministry of Statistics and Programme Implementation (MoSPI).

Functions of NSO

• Collection and compilation of official statistics
• Publication of GDP, inflation, employment, and socio-economic data
• Conducting nationwide surveys and statistical analysis
• Supporting evidence-based governance and policymaking

The NSO plays a vital role in ensuring reliability and credibility of India’s statistical system.

Challenges Ahead

Despite progress, India’s energy sector faces several challenges:

• Continued dependence on coal
• Storage and intermittency issues in renewable energy
• Need for grid modernisation
• High energy import dependence
• Financing requirements for green transition
• Balancing development with climate commitments

Addressing these challenges will require technological innovation, policy reforms, and international cooperation.

Conclusion

The Energy Statistics India 2026 report highlights India’s rapid progress in renewable energy expansion, improving power efficiency, and increasing investment in the energy sector. At the same time, it underscores the country’s continued dependence on coal and rising energy demand due to economic growth.

As India moves toward becoming a major global economy, ensuring affordable, secure, and sustainable energy will remain central to its developmental journey. The report provides an important roadmap for achieving energy security while supporting the transition toward a greener and cleaner future.

Context

India has temporarily reintroduced kerosene through the Public Distribution System (PDS) for 60 days due to disruptions in LPG and LNG supplies amid global energy tensions, especially around the Strait of Hormuz. The move reflects concerns over energy security and rising fuel prices.

About Kerosene

Kerosene is a flammable hydrocarbon fuel derived during crude oil refining.

Key Features

• Belongs to the middle distillate category of petroleum products.
• Composed mainly of hydrocarbons in the C10–C16 range.
• Burns in a controlled manner, making it suitable for household and industrial use.

Major Uses

• Household cooking
• Lighting
• Heating
• Aviation Turbine Fuel (ATF variant)

However, kerosene combustion generates significant indoor air pollution and harmful emissions, making it less environmentally friendly than LPG or electricity.

Why has India Reintroduced Kerosene?

1. Global Energy Disruptions

Geopolitical tensions affecting the Strait of Hormuz disrupted LPG and LNG supply chains, leading to shortages and rising prices.

2. Emergency Energy Security Measure

The government is treating kerosene as a temporary stopgap fuel to ensure uninterrupted cooking and lighting access, especially for vulnerable households.

3. Rural and Low-Income Dependence

In many remote regions, alternative clean fuels remain inaccessible or unaffordable during supply disruptions.

Kerosene Use in India: Trends

Historical Importance

• In 2011, nearly 43% of households used kerosene for lighting.
• It played a major role in rural energy access before widespread electrification.

Declining Usage

The importance of kerosene has sharply declined due to:

• Rural electrification
• Expansion of LPG access
• Pradhan Mantri Ujjwala Yojana

Currently, less than 1% households use kerosene as their primary cooking fuel.

Falling Production and Consumption

Concerns Associated with Kerosene Revival

Environmental Concerns

• Causes indoor air pollution
• Emits particulate matter and greenhouse gases
• Adversely affects respiratory health

Fiscal Concerns

Kerosene subsidies historically imposed a major burden:

• Subsidy expenditure reached ₹11,496 crore in FY16
• Leakages and diversion exceeded 40%

Energy Transition Concerns

Temporary revival of kerosene may slow the transition toward cleaner fuels and renewable energy sources.

Way Forward

• Strengthen strategic LPG reserves and supply diversification.
• Expand renewable cooking solutions such as solar and biogas.
• Improve energy infrastructure resilience.
• Ensure targeted and temporary kerosene support only during emergencies.
• Accelerate universal access to affordable clean energy.

Conclusion

India’s temporary return to kerosene highlights the continuing vulnerability of energy supply chains amid global geopolitical disruptions. While kerosene may provide short-term relief, long-term energy security lies in diversified imports, resilient infrastructure, and a sustained transition toward cleaner and sustainable fuels.