Freight transportation is a critical backbone of India’s transport sector and growing economy. Due to the rising demand for goods and services, the demand for freight transport in India is expected to grow fivefold over the next three decades. In addition, transport is a significant consumer of fossil fuels in India, a country with over 80% dependence on crude oil imports.
Freight transport already accounts for 40% of emissions from the transport sector, which is around 6% of India’s GHG emissions. The cost of freight transport, which at close to 14% of India’s GDP today, is one of the highest in the world. Enhancing the fuel efficiency of freight transport—by promoting more fuel-efficient vehicles, including a shift to ZEVs powered by renewable energy—is a huge opportunity to alleviate India’s import burden, reduce GHG emissions and improve air quality.
The demand for freight transport in India is expected to grow, which will lead to an increased demand for oil imports. Given that the majority of the oil demand in India is met through imports, the constant fluctuations in global oil prices will affect both the country’s economic growth and energy security. This will also come with the additional burden of rising emissions, worsening air quality and poor public health.
Freight transport is a major contributor to air pollution. Freight vehicles are predominantly diesel-powered, as diesel engines provide greater power and efficiency as compared to their petrol counterparts. But this efficiency comes at the cost of increased tailpipe emissions.
There are other inherent challenges that must be overcome in order to make this sector cleaner—such as the high cost of freight transportation and the slow adoption of cleaner technology options.
Vivek Chandran (Associate Director, Transport) emphasizes that “with India’s climate commitment to reach net zero by 2070, it is imperative to pay attention to the role of clean freight in decarbonizing transport.”
Shakti’s Clean Freight program works to enhance the environmental and energy efficiency of freight movement in India in ways that significantly reduce the climate, health, energy and cost impacts of freight transport. We work to create policy solutions for better fuel efficiency to help guide the transition to efficient vehicles including zero-emission trucks. We promote the adoption of financial mechanisms like ZEV credits, energy efficiency certificates and purchase subsidies that can help bridge the green premium required for the clean freight transition. We also support the adoption of energy efficient technologies for shipping fleets and contribute to the development of incentive programs for shippers to increase efficiency.