India decouples energy use from long-term economic growth

The country’s EE Index improved to 83 from 127.

India has demonstrated a sustained decoupling of energy consumption from economic growth, characterised by a long-term decline in the national Energy Efficiency (EE) Index.

According to an APO Productivity Outlook report, despite sharp contractions in energy use during 2019 and 2020, the overall trend shows energy demand growing more slowly than gross domestic product, signalling systemic efficiency gains.

This improvement is particularly evident in the manufacturing and services sectors.

In contrast, the agricultural sector experienced a decline in energy efficiency, marked by a rising EE Index.

Moreover, whilst total carbon dioxide emissions rose to 2.67 billion tonnes from 990 million tonnes, the EE Index improved from 127 to 83.

This trajectory was mirrored by the renewable energy share, which increased from 6.04% to 8.66%.

Additionally, whilst Gross Capital Formation fluctuated within a range of 25.7% to 32.1%, India’s technical efficiency improvements have remained resilient regardless of structural changes in capital investment.