Ironically, while the health crisis was an important turning point for accelerating the energy transition in response to climate change (Rosenow, 2026),[1] ongoing armed conflicts have had the opposite effect – leading to higher consumption of coal, oil, and gas (Watson School of International and Public Affairs, 2025). However, there are positive signals that the energy transition may continue amid the conflicts, with nations seeking to reduce their reliance on imported energy (primarily fossil fuels) to enhance their energy security (Rosenow, 2026).
The transition to clean energy has fallen victim to the politics of war
Just before the Russian invasion of Ukraine, there was a strong political willingness to adopt renewable energy and phase out fossil fuels. However, this trajectory was derailed by the war (Meredith, 2022), as most large economies prioritised energy security over decarbonisation and shifted back to fossil fuels.
The global political impetus for the energy transition suffered a major setback when the new US administration sought to slow or reverse global clean energy efforts (Debert, Letourneau and Le Billon, 2025), including through executive orders reducing funding for clean energy technologies and halting the operations of renewable energy companies (Crooks, 2025). The US government’s clampdown on climate actions has far-reaching implications, not only for clean energy technologies in the US but also for other governments, prompting them to scale back their clean energy ambitions.
The energy transition requires global consensus, but rapidly shifting political priorities around climate change are instead contributing to greater fragmentation. At the same time, political attention essential to facilitating the energy transition is being diverted towards fighting wars or managing conflicts (or the threat thereof).
Geopolitics – a blessing in disguise for the energy transition
The pace of the green energy transition may be throttled, but as governments continue to pursue affordable energy security, renewable energy may emerge as the winner. Irrespective of governments’ stances on climate change, the adoption of renewable energy is being driven by economic benefits and energy security needs (Abnett, 2026). Even if shifting to renewable energy requires importing renewable energy technologies, this would be a one-time effort, unlike fossil fuels, which need to be imported regularly.
While the price of low-carbon energy technologies is falling, the cost of new coal plants is rising (Rodrigues, Das & Ewen, 2025) – so it makes sense for countries to transition to renewable energy in the long run. Although carbon prices and the cost of gas and other fossil fuels determine the competitiveness of renewable energy, the trend is in favour of the latter. Besides, access to (and the terms of) financing must be favourable, particularly for developing countries, to accelerate the energy transition.
What should India’s stance on climate change be in such times of global turbulence?
India is one of the few countries that has met its United Nations Framework Convention on Climate Change (UNFCCC) commitments; India not only met its climate goals but also achieved them well before the deadline. India’s earlier commitment to reduce carbon intensity by 33–35% by 2030 (compared to 2005) was achieved in 2019 (PIB, 2023), 11 years ahead of schedule; India later revised its target to 45% (PIB, 2022). At the beginning of 2026, India declared it would increase its carbon intensity reduction target to 47% by 2035 (compared to 2005) (PIB, 2026). Although India’s latest target is not ambitious, the country declared its commitment to climate action despite significant geopolitical and energy security concerns, even as other countries are scaling back their climate commitments.
Now India must accelerate its energy transition not just to meet its international climate commitments, but also to achieve energy security and affordability – an objective that has been highlighted in the 2025 economic survey (PIB, 2025), although coal is considered the base load for grid stability and affordability. However, the economic survey also emphasised the energy transition as a way to enable India to reduce its reliance on imported energy (PIB, 2026), often from politically volatile regions.
Secondly, the cost of fossil fuels is highly volatile – any price increase adds inflationary pressure and strains India’s fiscal position. For example, every USD 10 increase in crude oil adds inflation pressure of 50 basis points (ANI, 2026).
Thirdly, imported energy consumes a significant share of foreign exchange reserves and puts pressure on the domestic currency during periods of high energy costs. Every USD 10 increase in the crude oil price could widen the current account deficit by 0.4% of the gross domestic product (GDP) (Srivastava, 2026). The green energy transition can reduce this burden.
Fourth, lower-cost renewable energy can make the economy more competitive – particularly the manufacturing sector, which India wants to scale up.
Fifth, India’s potential to rapidly develop the clean energy sector can place it at the forefront of climate action, while enhancing its influence in global diplomacy and international relations.
Finally, India can export clean energy technologies and services through large-scale manufacturing and the adoption of green energy technologies.
- India can take the following steps, and all these steps should be concurrent:
Electrify demand-side energy end uses, including machines, equipment, industrial processes, appliances, buildings, and vehicles. The source of electricity can be changed from fossil fuels to renewable energy. - While renewable energy has expanded in India, capacity additions for supportive technologies – such as transmission, distribution, and storage – have not kept pace with the growth in renewable energy capacity. While renewable energy addition can be accelerated, equal emphasis must be placed on supportive technologies.
- India’s heavy reliance on imported green technologies leaves it vulnerable, threatening energy security. Hence, India should push to accelerate the manufacturing of green technologies.
- One of the key challenges for the green energy transition is improving access to, and reducing the cost of, financing. The government and other public actors can intervene through a wide range of policy and regulatory measures to expand and deepen sources of financing, particularly from large institutional investors. A recent NITI Aayog (2026) report highlights policy and regulatory interventions to accelerate capital flows to the clean energy sector. Additionally, risk mitigation measures (e.g., credit enhancement and payment security mechanisms) can be deployed to reduce financing risks for clean energy in India.
Since green technologies are still not mature in India, and several segments are at early stages of development, policy interventions – in the form of fiscal (e.g., subsidies and incentives) and non-fiscal support (e.g., procurement rules and standards) – can provide an impetus for green manufacturing and green energy adoption. Although India has introduced several measures to drive the energy transition, now is the time to intensify them.
The energy shock is an opportunity for India to rapidly shift from a fossil-fuel-based energy system to a green-energy-based one, and the country must not let the opportunity slip away.
The blog is authored by Labanya Prakash Jena, Director at Climate and Sustainability Initiative (CSI). The views expressed here are the authors’ alone.
Endnotes
[1] The pandemic was an “accelerator” and “strategic pivot point” rather than the creator of climate policy, of course.
