The year 2024 was the warmest since 1850 on record globally, and India is amongst the countries that face the highest risk from the impacts of climate change. As the third-largest greenhouse gas emitter, India faces the dual challenge of maintaining economic growth while addressing climate concerns.
The energy sector alone accounts for around 75% of India’s total emissions, followed by agriculture (14%), industrial processes and product use (8%), and waste (3%), as reported in India’s Fourth Biennial Update Report (BUR-4). These sectors should, therefore, see targeted climate action.
Addressing climate change requires two strategies: mitigation and adaptation. While mitigation focuses on reducing greenhouse gas emissions, adaptation helps communities adjust to the unavoidable effects of climate change. In 2015, ahead of COP21 in Paris, India announced its first Nationally Determined Contributions (NDCs)–a climate action plan. These commitments included reducing the emissions intensity of its gross domestic product (GDP), increasing non-fossil fuel-based energy capacity, and creating additional carbon sinks through afforestation.
Over the last decade, India’s Union budgets have increasingly reflected its intent to integrate these strategies, aligning fiscal measures with national and international climate commitments. Ahead of the 2025-26 budget presentation, we look at how India’s budgets have advanced the country’s climate agenda over the years.