Globally, we're faced with an existential crisis in the form of climate change. We've been aware of it for many decades, but we're finally seeing more focus on the part of entrepreneurs, investors and the private sector. Five years ago, even in Cambridge, one wouldn't see founders highlighting the climate credentials of their startups. Even if the point was to focus on climate, they would downplay that element and focus on other aspects, like data science, or analytics. Whereas now, we’re seeing more and more businesses emerging that explicitly focus on climate action in countries like the US, the UK, India, and others. 

This surge in climate tech innovation in India, and across the world is aided by greater recognition of the urgency of climate change and growing enthusiasm for climate action amongst the youth in particular. 

What we're seeing is that large companies, like Infosys, Tata, and NTPC, are starting to take the issue more seriously, but we need to see innovation from both large and small companies, because that is what drives an economy and they have different roles to play. Startups are crucial for Indian economic growth. As we shift away from a fossil-based economy to a cleaner and ultimately, net zero economy, we need innovation from small as well as large firms to help drive economic growth. 

At the moment, there's significant enthusiasm among venture capitalists for climate tech. The only slight danger for the economy is that venture capital tends to go in waves. So the biggest challenge for India and other countries will be to sustain investment and growth in climate tech in not just the next three or four years, but in the coming decades. 

What will drive future commitments to climate action? If you look globally, and then in India, where youth make up a larger portion of the population, they have been a big driver of climate action. For instance, one can look at Fridays for Future, the global movement for climate action led by Greta Thunberg. More broadly, in terms of the attitudes of consumers, the aspirations of younger consumers with regard to the motor vehicles that they want, or their lifestyles being more environmentally conscious or climate considerate, is part of what is driving both firms and the government to take action. 

The critical part of turning public concern into action is that progress won't happen without government policies and direction. India's 2070 goal of net zero emissions in the context of an emerging economy is an enormous challenge and will need commensurate policies to meet that goal. The fact that the government finds this issue important leading to credible policies will hopefully translate into support for greater investment in climate action. 

It's also critical that the best of our universities, like Cambridge or the IITs of our world, take the lead. They have our smartest young people and the best scientists and engineers, who will make a difference by coming up with important innovations. What we can hope is that like ten or twenty years ago when the focus was on tech, telecoms and other sectors, the scientists and engineers will increasingly focus on climate change and related tech. The hope is that the best universities across the world embrace and lead the shifting focus. 

One of the ways to promote innovation is via competitions. These contests or prizes at university level for a better electric car or aircraft won't solve any problem by itself, but it does create a buzz, excitement, engagement amongst younger scientists or students, and also motivate them to work in this space. We are starting to see more of that now. More younger people, whether they are undergraduates, or in their masters programmes, are growing to embrace this issue. They will be the ones who will ultimately make a difference on the climate problem. 

When one thinks about the net zero emissions target, in climate tech, some kinds of solutions are more appropriate for heavy industries, like in steel production, and for others, small, local level solutions are ideal to work with, like in waste. So, arguably, for challenges like waste, there is greater opportunity for startups and smaller companies to make a big dent. India and many other countries have started to make progress in waste management, but part of the problem is that there is no single overarching solution. Such sectors will require multiple smaller-scale or tailored solutions. 

So tech startups have the opportunity to look for and work on issues that have not received much policy attention. That's where startups do best - coming up with new and creative ideas to deal with issues often neglected. Sometimes the startup is based around a new technology, sometimes a large part of the solution is understanding the context of a challenge and hence the potential solutions. And, by that logic, countries in the global south facing similar challenges as India, can become an obvious market opportunity for startups with emerging climate tech solutions. The presence of a global race to come up with solutions can drive greater investment in the sector. A big part of leading in that competition would involve anticipating problems and challenges and coming up with solutions in advance. 

Another opportunity is in road transport.  In the USA, Europe, and even China, the focus for electric mobility is primarily on four-wheelers. Arguably, there is opportunity for India and the global South in the two- and three-wheeler market for electric vehicles (EVs), because of the greater role of two and three wheelers in the region. Arguably, this becomes an important area for India to focus on both domestically and to meet the larger market in the global South. Two and three-wheelers are also one of the most polluting vehicles, making it even more important to replace them with EVs. Getting the population on board with replacing inefficient combustion engine vehicles with EVs is critical, so it is helpful having public support tied to addressing not only the global problem of climate change but also the local problem of air pollution. 

Another policy that can help spur climate action is trading in CO2 emissions, which is all about driving down emissions across the entire economy. Carbon trading would not only provide an opportunity for emission reduction but also an opportunity for financial services with respect to the carbon market. It will also efficiently incentivise emission reduction. This will also lead to greater attention to carbon accounting, measurement, and other technical details. And if we get those right, it will assist in enabling the energy transition at a reduced cost.