Towards sustainable consumption practices: Evidence from India

Abstract

India has made commitments at the global level towards supporting sustainable development goals and is progressing towards achieving them. Its position in the composite sustainable development index improved from 57 in 2018 to 60 in 2019 (Economic Survey 2019-2020, Government of India, in Sustainable development and climate change, Chapter 6, 2:167-192, 2020). This chapter aims at documenting and assessing policy measures adopted by government of India towards sustainable consumption with a special focus on policies towards energy efficiency. Energy consumption in India has been growing at an average growth rate of 5.3 per cent from the last five years, 2013-2017. India's share in global energy consumption has reached 5.6 per cent in 2017 (BP statistical review of world energy, 2018). With economic growth the energy consumption is expected to increase manifold in future. Energy consumption results in emissions leading to air pollution. Nine out of the ten most polluted cities in the world are in India. Vehicular emissions and industrial pollution are major factors for air pollution. The government of India has undertaken various policy measures towards energy conservation and efficient use of energy. While some of the policy measures target industries, other policy measures aim at sustainable consumption via demand-side policies. Energy consumption labels inform consumers of the relative efficiency of different products and are going to be effective if consumers are willing to pay a higher price for the energy-efficient products once information is provided. The chapter also includes a discrete choice experiment (DCE) conducted to investigate whether car drivers in New Delhi, India, value fuel-efficient cars. The DCE was designed to estimate consumers' willingness to pay for star labelled cars in New Delhi and estimate the impact of socio-economic characteristics such as income and education in influencing consumers' willingness to pay. The experiment is conducted in two districts of Delhi, South Delhi and East Delhi. The two districts differ in socio-economic characteristics such as affluence, education, occupational structure, etc. These differences have an interesting bearing on the results. We find that the South Delhi respondents have a stronger preference for high star label car and on average, are willing to pay 5050 US Dollars for the five star label car as compared to 1186 US Dollars by East Delhi respondents.