 "India on track to become third-largest economy by 2028: IEA projection")
India will over the next decade add more than 12,000 cars a day, expand built space equivalent to the built space in South Africa, and its air-conditioners will consume more electricity than entire power consumption in Mexico, the IEA said.
It is likely to see a rise in demand for all forms of energy -- from oil and gas to coal, electricity and renewable energy -- through 2035, making it the growth engine for energy demand globally, the International Energy Agency (IEA) said in its World Energy Outlook 2024.
India, the world's third largest oil consuming and importing nation, will see its demand for oil rise by almost 2 million barrels per day by 2035 and become the main source of oil demand growth in the world.
According to IEA projections, the country is on track to become the third-largest economy in the world by 2028.
It was the world's fifth largest economy and the fastest growing major economy in 2023, with output increasing by 7.8 per cent.
India overtook China in 2023 to become the most populous country in the world, even as its fertility rate dropped below replacement level.
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"The population size and the scale of rising demand from all sectors mean that India is poised to experience more energy demand growth than any other country over the next decade," IEA said.
In stated policies scenario (STEPS), "India is on track to add over 12,000 cars every day to its roads over the period to 2035. Built space is set to increase by over 1 billion square metres annually, which is larger than the total built space in South Africa today," IEA said.
By 2035, iron and steel production are on track to grow by 70 per cent; cement output is set to rise by nearly 55 per cent; and the stock of air-conditioners is projected to grow by over 4.5 times, resulting in electricity demand from air-conditioners in 2035 that is more than Mexico's total expected electricity consumption that year," it said.
IEA projected energy supply in India rising from 45.4 exajoule (EJ) in 2023 to 60.7 EJ in 2025 and 70.5 EJ in 2050 under stated policies (STEP). This gets tempered to 52 EJ in 2035 and 62 EJ by 2050 under announced pledges (APS).
Oil demand is seen growing from 5.2 million barrels per day to 7.1 million bpd by 2035. Capacity at refineries, to turn crude oil into fuels like petrol and diesel, will rise from 5.8 million bpd to 7.1 million bpd by 2035.
Demand for natural gas is seen rising from 64 billion cubic metres to 172 bcm in 2050. Coal output is seen tempering to 645 million tonnes in 2050 from 721 million tonnes in 2023.
Total energy demand in India is seen increasing by nearly 35 per cent by 2035 in the STEPS, and its electricity generation capacity nearly triples to 1,400 GW by 2035.
Coal is set to retain a strong position in the energy mix in India over the next decades. In the STEPS, nearly 60 GW of coal-fired capacity is added net of retirements by 2030, and electricity generation from coal rises by over 15 per cent.
Generation from coal remains over 30 per cent higher than that from solar PV even in a decade in which solar PV accounting for twice as much capacity, owing to the lower capacity factor of solar installations.
Coal has been playing a prominent role to meet energy demand in industry, providing 40 per cent of its energy needs in 2023.
By 2035, the consumption of coal in industry would have grown by 50 per cent, with its share in total industry demand remaining at similar levels as today.
"Looking ahead, India faces a range of challenges on the energy front, including ensuring universal clean cooking access, reducing fossil fuel import dependence, boosting the reliability of the power sector and the financial performance of distribution companies, addressing high levels of air pollution, and managing the impacts of climate extremes, especially heat waves and floods," IEA said.
In APS (announced pledges scenario) that takes into account India's commitment to achieve net zero emissions by 2070, clean power generation is nearly 20 per cent higher than in the STEPS by 2035, and India has the world's third-largest installed battery storage capacity in place by 2030 to accommodate the rising share of variable renewables.
"There is also a rapid rise in electric mobility, and this contributes to oil consumption peaking in the 2030s," IEA said, adding coal use in industry also peaks in the 2030s as industrial use of electricity and hydrogen rises steadily.
On its trajectory to net zero emissions by 2070, India's aggregate annual carbon dioxide emissions reach 2.5 billion tonnes in 2035, which is 25 per cent below the level in the STEPS.
India is one of the largest markets in the world for 2/3 wheel vehicles, and the fourth-largest passenger car market.
"Over the next decade, India adds over 37 million cars and over 75 million 2/3-wheelers to its roads in the STEPS," the report said.
While an increasing share of vehicle sales are electric, the simultaneous growth of internal combustion engine vehicles results in oil demand from road transport rising 40 per cent by 2035 in the STEPS, contributing to an increased dependence on oil imports.
"Adding over 12,000 additional cars every day in India places significant further demands on road infrastructure, exacerbates already poor air quality, and contributes to a 30 per cent rise in CO2 emissions from all road passenger transport by 2035," it said.