India’s industrial sector is undergoing a green makeover. A recent report by the Confederation of Indian Industry (CII) titled “Green Manufacturing: Driving Competitiveness through Resource Efficiency” outlines how Indian manufacturers are cutting emissions, saving energy, and reducing waste—all without sacrificing output.
According to the report, industries that adopt green manufacturing practices have seen a 10–20% improvement in energy efficiency and a 15–25% reduction in water usage. These shifts not only reduce environmental impact but also improve bottom lines, making sustainability a strategic business decision, not just a compliance mandate.
What’s driving the change?
A mix of regulation, economics, and innovation. India’s commitment to net zero by 2070, announced at COP26, has put pressure on industries to rethink their operations. Meanwhile, rising input costs—especially for water, electricity, and raw materials—have pushed companies to optimise processes.
CII’s GreenCo rating system, an initiative now applied across over 500 companies, has emerged as a key catalyst. GreenCo-rated factories have reported a 30–40% reduction in carbon emissions intensity, according to CII’s 2023 progress assessment. Many companies also claim payback periods of less than three years for their green investments—making the business case hard to ignore.
Where are these changes happening?
The green manufacturing movement is visible across India’s industrial belts. Tamil Nadu, Maharashtra, Gujarat, and Karnataka lead the way with dozens of certified green factories. Chennai, for example, has become a hub for energy-efficient auto component production, while Pune is investing heavily in water recycling and process optimisation in its engineering units.
In smaller cities like Hosur and Coimbatore, MSMEs are also joining in, aided by state-level subsidies and capacity-building programmes under the CII and UNIDO.
How are manufacturers going green?
The CII report outlines several best practices reshaping industrial operations:
• Energy Efficiency: Use of LED lighting, variable frequency drives (VFDs), and energy-efficient motors is now common. Some factories have cut power consumption by 20–25%.
• Renewable Integration: Rooftop solar panels now supply up to 40% of total power in many GreenCo-rated factories.
• Water Circularity: Leading facilities recycle up to 90% of their wastewater, aided by zero liquid discharge systems.
• Material Efficiency: Adoption of lean manufacturing and process redesign has helped reduce raw material usage by 10–15% in many units.
• Waste Reduction: Waste-to-resource initiatives such as industrial symbiosis—where one plant’s waste becomes another’s raw material—are increasingly common.
Several companies have also introduced internal carbon pricing mechanisms to guide investment decisions. This helps prioritise resource-efficient upgrades and makes environmental metrics part of routine decision-making.
When did this shift begin?
While some leading firms like Tata Motors and Godrej began exploring green manufacturing a decade ago, real momentum has built up in the last five years. Post-2018, India saw a sharp rise in GreenCo certifications, with over 500 companies now rated, according to CII. Pandemic-era supply chain shocks also nudged many industries to improve resource resilience, accelerating this trend.
Why green manufacturing matters now?
The industrial sector contributes nearly 25% of India’s total energy use and 20% of its carbon emissions, according to TERI and CEEW estimates. Transitioning to cleaner manufacturing is therefore critical to meeting national and international climate goals. Green manufacturing also offers co-benefits—improved air and water quality, better workplace safety, and lower operational risks.
The global market is shifting too. Exporters face mounting pressure from buyers and regulators to demonstrate sustainability across their supply chains. Practices like ESG disclosure, life cycle assessments, and green certifications are becoming non-negotiable.
Challenges on the factory floor
Despite the progress, several barriers remain. Small and medium enterprises (SMEs) often lack access to capital and technical expertise. There is also a shortage of skilled professionals who can design and operate low-emission systems.
According to CII, only 5–10% of Indian SMEs have adopted structured sustainability frameworks. Bridging this gap will require policy support, easier financing, and industry-led mentoring programmes. Efforts such as CII’s GreenCo Maturity Model and cluster-based training workshops are already in place, but scaling them remains a challenge.
Looking ahead
The CII report calls for deeper integration of green principles into India’s industrial strategy. It recommends expanding market-based mechanisms like Perform, Achieve, Trade (PAT), promoting cleaner technology funds, and embedding green literacy in engineering education.
If implemented at scale, these measures could position India as a global leader in sustainable manufacturing—combining environmental stewardship with industrial competitiveness.
India’s green manufacturing push is no longer a niche experiment. It’s an emerging mainstream trend that aligns ecological responsibility with economic logic. From top-tier conglomerates to mid-sized factories, the shift is real—but uneven. With the right support, the industrial sector can play a defining role in shaping India’s sustainable future.