India’s economic growth is possible to impact future international energy markets because of the country’s large population and potential for development. India is expected to be one of the fastest-growing economies in the world over the next 30 years, but how that growth will take place remains unknown.
Namely, EIA analyzes economic growth patterns in India that have the same rate of overall economic growth, and the results indicate a slightly different energy demand among those three.
Specifically, in the Export-led case, exports are more than double the share of GDP in 2040. The largest increase in energy consumption (33%) happens in this trade-intensive scenario, bringing India’s total energy consumption to more than 42 quadrillion British thermal units.
In the Investment-led case, investment and trade account for a larger share of Indian GDP in 2040. Exports and investment in this case each amount for about 35% to 40% of Indian GDP. The result is a 29% increase in energy consumption in 2040.
Across all cases, however, energy consumption in India in 2040 remains lower than in other large economies in 2015. For example, in 2015, Russia, China, South Korea, and the US all had levels of energy consumption that were four times larger than projected for India in 2040.
This is despite the fact that India is expected to be the world’s fastest-growing economy over the 2015 to 2040 period.