India's industrial growth is not at odds with clean air

India is at a pivotal moment in its economic journey. As a fast-growing economy in pursuit of developed status by 2047 under the government's Viksit Bharat vision, its development strategy relies heavily on rapid industrial growth. However, this growth is often framed as inevitably coming at the cost of deteriorating air quality. What if this trade-off were not inevitable?

- TEJAS C. PATEL & SANJANA GORTI

India has emerged as a leading voice for lowand middle-income countries on climate action, setting itself an ambitious target of achieving net zero emissions by 2070. Bridging the gap between economic growth and emission reduction requires bold innovations. One such innovation is an emissions trading scheme (ETS) for particulate matter (PM) pollution, piloted in Gujarat, a state at the forefront of industrialization.

Under an ETS, a regulator caps total emissions and allows businesses to trade allotted permits, offering them the flexibility to reduce emissions in a cost-effective way. To test whether the programme would work, the Gujarat Pollution Control Board (GPCB) teamed up with researchers from the University of Chicago, Yale University, University of Warwick and the Abdul Latif Jameel Poverty Action Lab (J-PAL). In the dense industrial city of Surat, a portion of firms participated in the ETS and others continued under conventional regulations. The researchers then compared the two groups.

The results were striking. Between 2019 and 2022, industrial units that joined the ETS reduced their particulate matter emissions by 20-30%, performing much better than those that were not a part of it.