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Moody's Ratings in its report titled ‘Carbon Transition - India’ has said India has made rapid progress building its renewables capacity, but its fast-growing economy and expanding population will drive up carbon-intensive product demand. Moody's expects India to remain one of the fastest growing economies in the world with real GDP growing 7.2 per cent in 2024 and 6.6 per cent in 2025. The country is likely to sustain similarly high rates of growth over the next decade.

It stated ‘With a rising population and industrialisation, this will drive higher energy needs. Increasing household incomes will also bolster demand for energy-intensive products such as automobiles.’ India's share of global greenhouse gas (GHG) emissions increased to 7.5 per cent in 2022, from 6.7 per cent in 2019.

Further, it said the government's ability to attract private investment and address negative spillovers from decarbonization, including job losses in legacy industries, will determine whether India's credit exposure to carbon transition and social risks rises further. India has committed to achieve net-zero emissions by 2070, and some progress has been made toward its 2030 interim decarbonization milestones. But, the country's fast-expanding economy will continue to drive up GHG emissions. Moreover, it said  India was the world's third-largest GHG emitter as of 2022, but its per capita emissions are still lower than other major economies, highlighting scope for further gains.