Critical minerals, nuclear push crucial to India's climate plan: Eco Survey

The Economic Survey says India plans a development-centred climate strategy that integrates adaptation, mitigation and behaviour change while strengthening energy security

The Economic Survey 2025–26, tabled in Parliament on Thursday by Union Finance Minister Nirmala Sitharaman, said the global climate agenda has reached an “inflexion point”, and highlighted the growing importance of critical minerals and nuclear energy in meeting climate goals.

What does India’s climate strategy look like?

The Economic Survey said India plans to adopt a development-centred climate strategy that brings together adaptation, mitigation and behaviour change. It noted that India is strengthening climate resilience by linking it closely with development. Spending on climate adaptation has risen from 3.7 per cent of gross domestic product (GDP) in FY16 to 5.6 per cent in FY22.

 

 

The Survey also said India is cutting emissions by expanding clean energy while ensuring energy security. The country has crossed 50 per cent non-fossil fuel power capacity, driven by solar, wind, nuclear energy, green hydrogen and bioenergy.

 

It added that access to critical minerals such as lithium, cobalt and rare earths now shapes the clean energy transition. India is building domestic capacity through the National Critical Mineral Mission and securing overseas supplies, including lithium projects in Argentina, Australia and Chile.

 

The new Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (Shanti) Act allows private sector participation in nuclear power, manufacturing and research, helping India strengthen its clean energy supply in the long term.

What does India’s climate financing look like?

The Survey said India, like many developing countries, does not receive enough climate finance to meet its goals. The global funding gap has widened to around $4 trillion, with most climate money remaining within developed countries.

 

For India, most climate funding still comes from domestic sources rather than international flows. Global finance mainly goes to areas such as solar and wind energy, while sectors such as climate adaptation, small businesses, urban infrastructure and hard-to-abate industries receive limited support.

How can India bridge the climate finance gap?

The Economic Survey suggested several ways to address the funding gap, including strengthening domestic finance, deepening bond markets and mobilising more international support.

 

It noted that public institutions such as the National Bank for Agriculture and Rural Development (Nabard) and the Small Industries Development Bank of India (Sidbi) are already supporting green projects. The Survey added that while global markets have enough capital, it does not flow easily to developing countries due to risk concerns. It called on global development banks to share risks better and use tools such as guarantees and blended finance to attract private investment into India’s climate projects.