Inflation in India’s wholesale prices hardened to a four-month high of 2.4% in October, from 1.84% in September, led by 11.6% acceleration in food prices, the first double digit uptick in 25 months, from a 9.5% increase recorded in the preceding month

2. What is the Wholesale Price Index(WPI)?

The Wholesale Price Index (WPI) is a measure of the changes in the prices of goods sold and traded in bulk by wholesale businesses to other businesses or retailers. It is one of the key indicators used to measure inflation and economic performance in a country.

WPI tracks the average price changes of goods at the wholesale level, providing insights into inflationary pressures in the economy. It includes various categories of goods such as agricultural products, industrial raw materials, fuel and power, and manufactured goods.

Governments and policymakers use WPI data to monitor inflation trends, formulate monetary and fiscal policies, and assess the overall health of the economy. It serves as a crucial tool for businesses to adjust pricing strategies, forecast costs, and make informed decisions regarding production and investment

3. Importance of WPI

The Wholesale Price Index (WPI) holds several significant roles in economic analysis and policymaking:

• WPI is a key indicator used to measure inflationary pressures in the economy. By tracking changes in the prices of goods at the wholesale level, it provides insights into the direction and magnitude of inflation. This data is crucial for policymakers in formulating monetary and fiscal policies to maintain price stability
• WPI serves as a barometer of economic performance, reflecting changes in production costs, input prices, and overall market conditions. Fluctuations in WPI can indicate shifts in supply and demand dynamics, business confidence, and economic activity levels
• Governments and central banks rely on WPI data to formulate and adjust monetary and fiscal policies. By assessing inflationary trends captured by WPI, policymakers can make informed decisions regarding interest rates, money supply, taxation, and government spending to achieve macroeconomic objectives such as price stability, economic growth, and employment generation
• Businesses utilize WPI as a tool for forecasting production costs and adjusting pricing strategies. By monitoring changes in wholesale prices of goods, companies can anticipate future cost pressures, optimize supply chain management, and make pricing decisions to maintain profitability and competitiveness in the market
• WPI data is also crucial for analyzing trends in international trade. Changes in wholesale prices can affect export competitiveness, import demand, and trade balances. Policymakers use WPI information to assess the impact of exchange rate fluctuations, trade policies, and global economic conditions on domestic industries and trade relations

The Consumer Price Index (CPI) is a measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food, and medical care. It is one of the most widely used indicators for tracking inflation and assessing changes in the cost of living over time.

CPI is calculated by collecting price data for a representative sample of goods and services that are typically purchased by urban consumers. The prices of these items are then aggregated and weighted according to their relative importance in the average consumer's expenditure. The resulting index reflects the average price level experienced by consumers

CPI is used by governments, central banks, businesses, and households for various purposes:

• CPI is primarily used to measure inflation, which is the rate at which the general level of prices for goods and services is rising. By tracking changes in the CPI over time, policymakers can gauge the extent of inflationary pressures in the economy and adjust monetary and fiscal policies accordingly
• Many labour contracts, pension plans, and government benefits are indexed to CPI. This means that payments or wages are adjusted periodically based on changes in the CPI to maintain purchasing power and account for changes in the cost of living
• Central banks often use CPI as a key input in their monetary policy decisions. By targeting a specific inflation rate, central banks aim to achieve price stability and support sustainable economic growth. CPI data helps policymakers assess whether monetary policy actions are effectively controlling inflation
• Investors and financial analysts use CPI data to adjust their investment strategies and financial planning. Understanding inflation trends can help investors anticipate changes in interest rates, bond yields, and stock market performance, which in turn influence investment decisions
• CPI data provides insights into consumer behavior and spending patterns. Changes in the prices of specific goods and services reflected in the CPI can affect consumer preferences, purchasing decisions, and overall economic activity

5.What is the distinction between WPI and CPI?

 

Subject	Wholesale Price Index (WPI)	Consumer Price Index (CPI)
Scope of Goods and Services	Measures changes in prices of goods traded in bulk by wholesalers, including raw materials, intermediate goods, and finished goods.	Tracks changes in prices of goods and services purchased by households for consumption, including food, housing, transportation, etc.
Target Audience	Relevant to businesses, policymakers, and analysts involved in production, manufacturing, and trade.	Important for individuals, households, labor unions, and policymakers involved in setting wages, pensions, and social security benefits.
Weighting and Composition	Based on a fixed basket of goods and services weighted according to their relative importance in wholesale trade.	Based on a basket of goods and services representative of urban consumer spending patterns.
Policy Implications	Changes in WPI affect production costs, supply chain management, and business profitability. Used by policymakers to assess inflation trends and formulate industrial and trade policies.	Changes in CPI directly impact the cost of living for households and influence consumer behavior, purchasing power, and welfare. Used by policymakers to adjust wages, social benefits, and taxation policies.

 

6. Way Forward

 

Both WPI and CPI are measures of price levels, they differ in their scope, target audience, composition, and policy implications. WPI focuses on wholesale trade and production costs, while CPI reflects consumer spending patterns and the cost of living for households

 

For Prelims: Consumer Price Index, Wholesale Price Index, Inflation,  retail inflation, Producer Pirce Index, National Statistical Office, OPEC+, Crude oil, Kharif season, Monsoon,  For Mains:  1. Analyse the factors contributing to high food inflation in India in recent months. Discuss the impact of high food inflation on the Indian economy and suggest measures to mitigate it. (250 words) 2. Explain the concept of sticky inflation. What are the various factors that contribute to sticky inflation? Discuss the implications of sticky inflation for the Indian economy. (250 words)

 

 

Previous Year Questions   1. With reference to inflation in India, which of the following statements is correct? (UPSC 2015) A. Controlling the inflation in India is the responsibility of the Government of India only B. The Reserve Bank of India has no role in controlling the inflation C. Decreased money circulation helps in controlling the inflation D. Increased money circulation helps in controlling the inflation   Answer: C   2. With reference to India, consider the following statements: (UPSC 2010) 1. The Wholesale Price Index (WPI) in India is available on a monthly basis only. 2. As compared to Consumer Price Index for Industrial Workers (CPI(IW)), the WPI gives less weight to food articles. Which of the statements given above is/are correct?  A. 1 only       B. 2 only       C. Both 1 and 2          D.  Neither 1 nor 2   Answer: C   3. Consider the following statements: (UPSC 2020) 1. The weightage of food in Consumer Price Index (CPI) is higher than that in Wholesale Price Index (WPI). 2. The WPI does not capture changes in the prices of services, which CPI does. 3. Reserve Bank of India has now adopted WPI as its key measure of inflation and to decide on changing the key policy rates. Which of the statements given above is/are correct?  A. 1 and  2 only       B. 2 only       C. 3 only           D. 1, 2 and 3   4. India has experienced persistent and high food inflation in the recent past. What could be the reasons? (UPSC 2011) 1. Due to a gradual switchover to the cultivation of commercial crops, the area under the cultivation of food grains has steadily decreased in the last five years by about 30. 2. As a consequence of increasing incomes, the consumption patterns of the people have undergone a significant change. 3. The food supply chain has structural constraints. Which of the statements given above are correct?  A. 1 and 2 only          B. 2 and 3 only        C. 1 and 3 only          D. 1, 2 and 3   Answer: B     5. The Public Distribution System, which evolved as a system of management of food and distribution of food grains, was relaunched as _______ Public Distribution System in 1997. (SSC JE EE 2021)  A. Evolved         B. Transformed      C. Tested            D. Targeted   Answer: D   6. Under the Antyodaya Anna Yojana, up to what quantity of rice and wheat can be purchased at a subsidised cost? (FCI AG III 2023)  A. 35 kg          B. 40 kg          C. 30 kg           D. 25 kg           E. 50 kg   Answer: A   7. As per the the National Statistical Office (NSO) report released on 7 January 2022, India's Gross domestic product (GDP) is expected to grow at ___________ per cent (in first advance estimates) in the fiscal year 2021-22?  (ESIC UDC 2022)  A. 17.6 per cent     B. 9.5 per cent     C. 11 per cent        D. 9.2 per cent   E. None of the above   Answer: D   8. The main emphasis of OPEC (Organisation of the Petroleum Exporting Countries) is on which of the following? (UKPSC 2016) A. The production of petroleum B. Control over prices of petroleum C. Both (a) and (b) D. None of the above   Answer: C   9. In the context of global oil prices, "Brent crude oil" is frequently referred to in the news. What does this term imply? (UPSC 2011) 1. It is a major classification of crude oil. 2. It is sourced from the North Sea. 3. It does not contain sulfur. Which of the statements given above is/are correct? A. 2 only    B. 1 and 2 only        C. 1 and 3 only         D. 1, 2 and 3   Answer: B   10. The term 'West Texas Intermediate', sometimes found in news, refers to a grade of (UPSC 2020) A. Crude oil   B. Bullion         C. Rare earth elements       D.  Uranium   Answer: C   11. With reference to the cultivation of Kharif crops in India in the last five years, consider the following statements: (UPSC 2019) 1. Area under rice cultivation is the highest. 2. Area under the cultivation of jowar is more than that of oilseeds. 3. Area of cotton cultivation is more than that of sugarcane. 4. Area under sugarcane cultivation has steadily decreased. Which of the statements given above are correct?  A. 1 and 3 only        B.  2, 3 and 4 only        C. 2 and 4 only         D. 1, 2, 3 and 4   Answer: A

 

Source: The Hindu

 

MAHARAJA RANJIT SINGH 

 

1. Context

 

November 13 marks the birth anniversary of Maharaja Ranjit Singh of Punjab. He was born on November 13, 1780 in Gujranwala, now in Pakistan, and ruled Punjab for almost four decades (1801-39). At the time of his death, he was the only sovereign leader left in India, all others having come under the control of the East India Company in some way or the other.

 

2. Maharaja Ranjit Singh

 

• In 1799, Ranjit Singh unified the Sikh Empire after capturing Lahore, defeating powerful chieftains who had divided the region into Misls. His victory over Afghan invaders earned him the title "Lion of Punjab" (Sher-e-Punjab), and he made Lahore his capital, where he ruled until his death.

• Ranjit Singh's empire extended across multiple regions. It included the former Mughal provinces of Lahore and Multan, along with parts of Kabul and the entire Peshawar region. His empire stretched from Ladakh in the northeast—where his general Zorawar Singh conquered it—to the Khyber Pass in the northwest, and south to Panjnad, where the five rivers of Punjab merged with the Indus. During his reign, Punjab was often referred to as the land of six rivers, with the Indus as the sixth.

• Ranjit Singh skillfully balanced his role as a Sikh ruler with his desire to be a protector of the empire’s Muslim and Hindu populations. He initiated a public effort to restore Sikh temples, most famously rebuilding the Harmandir Sahib (Golden Temple) in marble in 1809 and later in gold in 1830. Additionally, he donated a ton of gold to plate the Hindu Kashi Vishwanath Temple in Varanasi.

• He supported Hindu temples, Muslim mosques, and Sufi shrines, and, showing respect for Hindu traditions, banned cow slaughter. Forced conversions were rare in his kingdom, and he allowed his Muslim and Hindu wives to freely practice their religions.

• To counter the British, Ranjit Singh decided to modernize his army, adopting European military practices. Unusually for an Indian ruler at the time, he hired French and Italian mercenaries who had fought under Napoleon until his defeat in 1815.

• The newly formed Fauj-i-Khas ("special army") was led by Ranjit Singh's trusted generals, Jean-Baptiste Ventura and Jean-Francois Allard, who received substantial salaries of Rs 30,000 annually. They were later joined by Auguste Court and Paolo Avitabile. These officers settled in Lahore, adapting to local culture, marrying Indian women, and employing court artists. In 2016, a bronze statue of the Maharaja was unveiled in St. Tropez in honor of his legacy

3. Treaty of Amritsar

 

The Treaty of Amritsar was a significant agreement signed on March 25, 1846, between the British East India Company and Gulab Singh, the ruler of Jammu and Kashmir. The treaty marked the formal annexation of the princely state of Jammu and Kashmir into the British sphere of influence.

Under the terms of the treaty, Gulab Singh, who had been a prominent figure in the region, was required to pay a sum of 75 lakh rupees to the British in exchange for his sovereignty over Jammu and Kashmir. The British, in return, relinquished their claims to the territory and recognized Gulab Singh as the independent ruler of Jammu and Kashmir.

This treaty had several significant consequences:

• Annexation of Kashmir: The British formally acknowledged Gulab Singh as the ruler of Jammu and Kashmir, but they effectively gained control over the region by manipulating local rulers.
• Strategic Importance: The region, particularly Kashmir, held strategic value due to its location near the borders with Afghanistan, China, and Central Asia. The British sought to secure their interests in the northwest by controlling or influencing the region through this treaty.
• Political Impact: The Treaty of Amritsar was controversial, as it had long-lasting effects on the political landscape of Kashmir, leading to tensions and conflicts in the region over the years

 

4. After math since the death of Ranjit Singh

 

• Following Ranjit Singh’s death in 1839, the British East India Company increased its military presence in areas neighboring Punjab. This led to inevitable conflict between the Khalsa (the Sikh army) and the British, sparking the Anglo-Sikh Wars.

• The first of these wars, fought from late 1845 to early 1846, resulted in the defeat and partial subjugation of the Sikh Empire, leading to the cession of Jammu and Kashmir, which was made a separate princely state under British suzerainty.

• In 1849, the British delivered a decisive and conclusive defeat to the Sikhs. After this, 10-year-old Maharaja Duleep Singh was made a British pensioner and exiled to London for the rest of his life, where he surprisingly became a favorite of Queen Victoria.

• One of the British's notable acquisitions was the Koh-i-Noor diamond, which remains a prominent part of the British crown to this day

 

5. Way Forward

 

The death of Ranjit Singh in 1839 marked the beginning of a period of vulnerability for the Sikh Empire, eventually leading to its subjugation by the British. The Anglo-Sikh Wars, particularly the first in 1845-46, resulted in the weakening of the Sikh forces and the annexation of key territories like Jammu and Kashmir. The final defeat in 1849 further diminished Sikh power, with Maharaja Duleep Singh being exiled to London, symbolizing the British consolidation of control over the region. This period also saw the acquisition of the Koh-i-Noor diamond, a symbol of British imperial wealth and power, which remains part of the British crown today. The aftermath of these events reshaped the political landscape of India, establishing British dominance in Punjab and the surrounding areas for decades to come

For Prelims: Ranjit Singh’s Rise and Establishment of the Sikh Empire (1799), Anglo-Sikh Wars (1845–1849), Treaty of Amritsar (1846)   For Mains: Anglo-Sikh Wars and British Expansion, Impact of British Colonialism in Punjab

 

Source: Indianexpress

 

COP 29

 

1. Context

In the run-up to the 29th session of the Conference of the Parties (COP29) to the United Nations Framework Convention on Climate Change (UNFCCC), it was touted as “the finance COP”, while the ‘New Quantified Climate Goal (NQCG)’ was among the key priority issues to be discussed therein

 

2.Intergovernmental Panel on Climate Change (IPCC)

 

• A significant milestone in COP history was the establishment of the Intergovernmental Panel on Climate Change (IPCC) in 1988, a collaborative effort between the World Meteorological Organization (WMO) and the United Nations Environment Programme (UNEP).
• The IPCC's primary role is to produce comprehensive assessment, special, and methodological reports that review scientific data on climate change and propose potential responses.
• Today, the IPCC is recognized as a critical boundary organization at the science-policy interface, but during the 1980s, climate science faced considerable uncertainty, skepticism, and limited data. The release of the IPCC's first report in 1990 was pivotal, prompting global calls for a climate change treaty

• The Intergovernmental Panel on Climate Change (IPCC) is an international organization founded in 1988 by the World Meteorological Organization (WMO) and the United Nations Environment Programme (UNEP).
• It was created to provide a clear, scientific view of the current state of knowledge on climate change, its potential impacts, and possible response options.
• The IPCC does not conduct its own research; rather, it assesses and synthesizes the work of thousands of scientists worldwide to deliver objective and transparent reports.
• These assessment reports are widely used by policymakers to inform climate-related decisions and international negotiations, such as those under the United Nations Framework Convention on Climate Change (UNFCCC).
• The IPCC’s work is structured around producing major assessment reports, special reports on specific issues, and methodologies to assist nations in compiling greenhouse gas inventories.
• Its first report, published in 1990, was instrumental in bringing global attention to climate change and laid the groundwork for the formation of international climate treaties, including the UNFCCC.
• Over time, the IPCC has become a critical link between scientific research and policy action, helping shape the global response to climate change

3.Intergovernmental Negotiating Committee (INC) 

 

• The Intergovernmental Negotiating Committee (INC) was a key body established to develop and negotiate international agreements on climate change. Formed in response to the growing urgency to address climate issues, the INC's most significant achievement was drafting the United Nations Framework Convention on Climate Change (UNFCCC), which was finalized and adopted at the Earth Summit in Rio de Janeiro in 1992.
• The INC consisted of representatives from various countries and was tasked with creating a framework for global cooperation on climate action. This involved negotiating the responsibilities of countries to reduce greenhouse gas emissions, adapt to the impacts of climate change, and promote sustainable development practices.
• The work of the INC laid the foundation for subsequent climate treaties and protocols, including the Kyoto Protocol and the Paris Agreement, establishing a path for international collaboration on climate change mitigation and adaptation.
• The committee’s work concluded once the UNFCCC was adopted, and its ongoing functions were transferred to the Conference of the Parties (COP), which now convenes annually to review progress and negotiate further commitments

4. United Nations Framework Convention on Climate Change (UNFCCC)

 

• The United Nations Framework Convention on Climate Change (UNFCCC) is a foundational international treaty adopted at the Earth Summit in Rio de Janeiro in 1992.
• Its primary goal is to address climate change by stabilizing greenhouse gas concentrations in the atmosphere to prevent dangerous human-induced interference with the climate system. The UNFCCC serves as the main framework guiding global efforts to mitigate climate change, adapt to its impacts, and promote sustainable development.
• Under the UNFCCC, countries agreed to collaborate on climate action, with developed nations taking the lead in reducing emissions, recognizing their historical contributions to greenhouse gas levels.
• The convention established a process for ongoing negotiations, known as the Conference of the Parties (COP), where member states meet annually to review progress, set goals, and negotiate commitments.
• Key agreements, such as the Kyoto Protocol in 1997 and the Paris Agreement in 2015, were formed under the UNFCCC framework, enabling countries to establish legally binding or voluntary emissions reduction targets and adaptation strategies.
• The UNFCCC remains a crucial platform for international cooperation on climate change, involving over 190 countries in efforts to address one of the most pressing global challenges of the 21st century

5. Conference of Parties (CoP)

 

• The UNFCCC established ambitious goals for tackling climate change, yet it became clear that additional processes were necessary to support and expand the convention's objectives.
• Over time, the Framework Convention led to the creation of various institutions, processes, and structures to foster global collaboration.
• Among these was the establishment of the Conference of the Parties (COP), which serves as the convention's primary governing body.
• Each year, the COP gathers representatives from the parties—countries that have ratified the UNFCCC—to review progress, negotiate further actions, and strengthen commitments.
• The COP is unique as the world’s only multilateral forum where nearly all nations come together to jointly craft and implement climate policies. Currently, the UNFCCC includes 198 parties (197 countries and the European Union).
• The first COP took place in Berlin, Germany, in 1995, where the Berlin Mandate was introduced. This milestone emphasized the need for legally binding commitments specifically for developed countries, marking a significant advancement in international climate action

 

6. Kyoto Protocol

 

• The Kyoto Protocol is an international treaty that was adopted in 1997 under the United Nations Framework Convention on Climate Change (UNFCCC) and came into effect in 2005.
• It was the first legally binding agreement to set specific greenhouse gas emission reduction targets for developed countries, recognizing their historical responsibility for climate change.
• The protocol’s primary objective was to reduce global emissions by at least 5% below 1990 levels during its first commitment period, from 2008 to 2012.
• One of the protocol's innovative features was its market-based mechanisms, including emissions trading, the Clean Development Mechanism (CDM), and Joint Implementation (JI).
• These mechanisms allowed countries to meet part of their targets through investments in emission-reducing projects, either within their own borders or in other nations, especially developing countries.
• While the Kyoto Protocol marked a major step forward in international climate policy, it faced challenges. Some key nations, such as the United States, opted not to ratify it, and developing countries were not required to reduce emissions under the agreement, leading to criticism about its fairness and effectiveness.
• Despite its limitations, the Kyoto Protocol set the foundation for future climate agreements, including the Paris Agreement, which took a more inclusive approach to emission reductions

 

 

For Prelims: COP29, United Nations Framework Convention on Climate Change, Paris Agreement, Fossil Fuel, Loss and Damage Fund, carbon dioxide, Methane, Glasgow conference For Mains:  1. Examine the key outcomes of COP28, focusing on the measures aimed at transitioning away from fossil fuels and mitigating methane emissions. Assess the effectiveness of the agreements in catalyzing immediate climate actions. (250 Words)

 

 

Previous Year Questions 1. The UN Framework Convention on Climate Change (UNFCCC) has announced which country to host the 28th Conference of the Parties (COP28) in 2023? (SSC CGL 2023)  A. UAE       B. US          C. UK            D. Russia   2. The United Nations Framework Convention on Climate Change (UNFCCC) is an international treaty drawn at (UPSC 2010) A. United Nations Conference on the Human Environment, Stockholm, 1972 B. UN Conference on Environment and Development, Rio de Janeiro, 1992 C. World Summit on Sustainable Development, Johannesburg, 2002 D. UN Climate Change Conference Copenhagen, 2009   3. UNFCCC (United Nations Framework Convention on Climate Change) entered into from - (Sr. Teacher Gr II NON-TSP G.K. 2018) A. 21 March 1994       B. 5 June 1992           C.  12 May 1991         D. 5 June 1993   4. The 'Paris Agreement' adopted in Conference of the Parties (COP 21) in December 2015 will be effective provided the document is signed by: (UPSC CAPF 2016)  A. 51 UNFCCC parties accounting for at least 51% of global greenhouse gas emission B. 51 UNFCCC parties accounting for at least 55% of global greenhouse gas emission C. 55 UNFCCC parties accounting for at least 55% of global greenhouse gas emission D. 75 UNFCCC parties accounting for at least 51% of global greeenhouse gas emission    5. The term ‘Intended Nationally Determined Contributions’ is sometimes seen in the news in the context of (UPSC 2016) (a) pledges made by the European countries to rehabilitate refugees from the war-affected Middle East (b) plan of action outlined by the countries of the world to combat climate change (c) capital contributed by the member countries in the establishment of Asian Infrastructure Investment Bank (d) plan of action outlined by the countries of the world regarding Sustainable Development Goals   6. With reference to the Agreement at the UNFCCC Meeting in Paris in 2015, which of the following statements is/are correct? (UPSC 2016) The Agreement was signed by all the member countries of the UN and it will go into effect in 2017. The Agreement aims to limit the greenhouse gas emissions so that the rise in average global temperature by the end of this century does not exceed 2°C or even 1.5°C above pre-industrial levels. Developed countries acknowledged their historical responsibility in global warming and committed to donate $1000 billion a year from 2020 to help developing countries to cope with climate change. Select the correct answer using the code given below. (a) 1 and 3 only       (b) 2 only           (c) 2 and 3 only              (d) 1, 2 and 3 Answers: 1-A, 2-B, 3-A, 4-C, 5-B, 6-B Mains 1. ‘Climate change’ is a global problem. How India will be affected by climate change? How Himalayan and coastal states of India will be affected by climate change? (UPSC 2017) 2. Describe the major outcomes of the 26th session of the Conference of the Parties (COP) to the United Nations Framework Convention on Climate Change (UNFCCC). What are the commitments made by India in this conference? (UPSC 2021)

 

Source: The Indian Express

 

INTERNATIONAL SOLAR ALLIANCE (ISA)

 

 

1. Context

 

At the 2015 climate summit in Paris, India formed the International Solar Alliance (ISA) with a few other countries, notably conference host France, to expedite the deployment and absorption of solar energy around the world, with a focus on developing countries. Over time, the ISA has expanded into an intergovernmental institution with over 110 member countries. However, its impact on accelerating the adoption of solar energy in the poor countries has been exceedingly limited till now

 

2. What is the International Solar Alliance (ISA)?

 

• The International Solar Alliance (ISA) is an initiative led by India and France, launched during the United Nations Climate Change Conference (COP21) in Paris in 2015.
• It aims to promote the use of solar energy globally, especially in solar-rich countries lying fully or partially between the Tropic of Cancer and the Tropic of Capricorn. However, membership is now open to all UN member countries

• India, as a founding member, uses ISA as a platform to advance its renewable energy targets, including the ambitious goal of achieving 500 GW of renewable capacity by 2030.
• The ISA complements India's domestic initiatives, like the National Solar Mission
• In 2021, the United States joined the ISA, signaling global support for solar energy adoption.
• The One Sun, One World, One Grid (OSOWOG) initiative, also led by India, aligns with ISA’s objectives by advocating for a transnational solar grid that connects renewable energy sources globally.

 

3. What is India’s solar capacity as of now?

 

• The ISA was intended to act as a catalyst, helping countries tackle challenges like financial, technological, and regulatory barriers to adopt solar energy effectively.

• Despite significant advancements in solar energy deployment, ISA has had limited success in facilitating a large number of projects. Over the past five years, global solar power capacity has grown by over 20% annually, with a more than 30% increase reported last year, as indicated by ISA’s World Solar Market Report 2024.

• Ajay Mathur, director general of ISA, noted that most of these new installations are concentrated in a few countries, with China leading the way. Of the 345 GW of solar capacity added in 2023, China alone contributed over 216 GW, representing more than 62% of the total.

• More than 80% of global solar energy investments go to developed countries, China, and major emerging markets like India.

• Many countries lack experience with large-scale energy projects, especially in solar, which is a relatively new technology. Local developers are often absent, meaning international companies are needed for investment. However, these investors typically look for policy stability and well-defined regulatory frameworks.

• ISA has partnered with governments and local organizations to help establish regulatory frameworks, prepare power purchase agreements, and train local professionals

 

India’s dedication to renewable energy and climate action was fundamental to the establishment of the ISA. With a goal of reaching 500 GW of non-fossil fuel energy by 2030, India’s renewable energy targets align with the ISA’s mission to promote solar energy worldwide. This target is part of India’s broader Panchamrit Initiative, which focuses on reducing carbon emissions and advancing sustainable development. Additionally, India is instrumental in shaping ISA’s programs and promoting global cooperation. Its extensive experience in scaling solar energy projects and developing supportive policies serves as a model for other member nations, particularly those aiming to expand energy access. By sharing best practices and technical knowledge, India seeks to support other countries in advancing their solar energy initiatives.

 

4. Significance of ISA

 

• Solar energy plays a pivotal role in the global shift to renewable energy, which is essential for addressing climate change. It is the fastest-growing renewable source, though it does face the challenge of intermittency.

• In many parts of the world, solar is now the most cost-effective energy source when sunlight is available. Projections for solar energy capacity show it could expand by 3 to 15 times by 2050, depending on the pathway chosen to reach global net-zero emissions.

• China leads in solar PV installations, accounting for about 43% of the world's total. The top ten markets together hold over 95% of installed capacity, while less than 2% of new solar installations are in Africa—a region where nearly 80% of the 745 million people without electricity reside.

• The ISA was founded with a broader strategic vision for India, aiming to enhance its influence, especially among the Global South, with a particular focus on African nations

5. Objectives of ISA

 

• The International Solar Alliance (ISA) seeks to mobilize $1 trillion in solar investments by 2030 through its 'Towards 1000' strategy, which aims to lower both technology and financing costs.
• This ambitious plan targets energy access for 1 billion people and the installation of 1,000 GW of solar capacity. Achieving these objectives would reduce global carbon emissions by approximately 1,000 million tonnes of CO₂ per year.
• ISA’s programs focus on three core areas—Analytics & Advocacy, Capacity Building, and Programmatic Support—to establish a supportive environment for solar investments and share best practices among member nations.
• ISA also drives solar adoption across sectors such as agriculture, healthcare, transportation, and power generation. By promoting policies and facilitating the exchange of successful strategies, ISA enables member countries to encourage solar energy deployment.
• The alliance has introduced innovative business models, supported governments in developing solar-friendly policies via its Ease of Doing Solar analytics, and pooled demand to reduce costs of solar technologies.
• Additionally, ISA enhances financing access by lowering investment risks, making the solar sector more attractive to private investors and paving the way toward a sustainable energy future.

6. India's Solar Sector and Government Initiatives

 

• India's solar sector is growing rapidly, placing the country fifth globally in terms of solar power capacity. As of September 2024, India’s installed solar capacity has reached around 90.76 GW, a 30-fold increase over the last nine years. According to the National Institute of Solar Energy, the country’s solar potential is estimated at 748 GW.
• India’s Panchamrit targets include: (i) achieving 500 GW of non-fossil fuel energy capacity by 2030, (ii) sourcing 50% of its energy from renewables by 2030, (iii) reducing projected carbon emissions by one billion tonnes by 2030, (iv) cutting carbon intensity by 45% by 2030, and (v) reaching Net Zero by 2070.
• India has made significant progress, with its non-fossil fuel capacity increasing by 396% over the past 8.5 years, and 46.3% of its total energy capacity now comes from non-fossil sources, underscoring its dedication to sustainable energy as highlighted in international climate forums.
• Government policies, including the 100% FDI allowance in renewable energy projects, have enhanced the sector's appeal to investors. Additionally, technological advancements and a strong regulatory framework are creating an enabling environment for the continued expansion of solar energy projects

7. Way Forward

 

The International Solar Alliance (ISA) represents a pivotal shift towards a sustainable energy future, with India at the forefront of this initiative. The ISA’s mission extends beyond improving energy access and security to making substantial global carbon emissions reductions. The upcoming assembly offers an essential platform for nations to collaborate and emphasize the urgent need to accelerate solar energy adoption.

As more countries align with ISA’s mission, solar energy is positioned to play a central role in the global energy landscape. The ISA’s efforts, coupled with India’s strong commitment to solar advancement, pave the way for a cleaner, more sustainable world for future generations. Through international cooperation and innovative approaches, the ISA is well-positioned to contribute meaningfully to global climate objectives and universal energy access

 

 

For Prelims: General issues on Environmental ecology, Bio-diversity & climate change For Mains: GS-III: Conservation, environmental pollution and degradation, environmental impact assessment.

 

 

 

 

Previous Year Questions   1.Consider the following statements: (2016) The International Solar Alliance was launched at the United Nations Climate Change Conference in 2015. The Alliance includes all the member countries of the United Nations. Which of the statements given above is/are correct? (a) 1 only (b) 2 only (c) Both 1 and 2 (d) Neither 1 nor 2 Answer (a)   Statement 1 is correct. The International Solar Alliance (ISA) was launched at the United Nations Climate Change Conference (COP21) in 2015 in Paris. Statement 2 is incorrect. Initially, the ISA was intended for solar-rich countries lying fully or partially between the Tropics of Cancer and Capricorn. However, in subsequent years, the membership was expanded to include all UN member countries

 

Source: PIB