SDG 9: India calling Industry Innovation, and Infrastructure

India calling Industry, Innovation, and Infrastructure

Industry, Innovation & Infrastructure is the ninth sustainable development goal with the aim to build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation with the goal to create awareness and promote economic growth, social development, and climate action.

Investment and development of new technology are essential for this goal to be successfully achieved. As the pandemic has shown, global scenarios can change in an instant, with humanity needing to adapt quickly to survive. At the same time, increasing inequalities have only made it more difficult to achieve consensus on several key issues of sustainability—the top 1%ile own 42% of the world's total wealth.

In such a scenario, The ninth sustainable development goal becomes more important as it emphasizes making equal opportunity available to all individuals through industrialization and building resilient infrastructure. SDG 9 also recognizes the importance of technology and the role it plays in connecting humans and bridging inequalities. It plays a crucial role in overcoming the many interlinked economic, social, and environmental challenges.

SDG 9 has eight targets, and progress is measured by twelve indicators. The first five targets are "outcome targets": Develop sustainable, resilient, and inclusive infrastructures; promote inclusive and sustainable industrialization; increase access to financial services and markets; upgrade all industries and infrastructures for sustainability; enhance research and upgrade industrial technologies. The remaining three targets are "means of achieving" targets: Facilitate sustainable infrastructure development for developing countries; support domestic technology development and industrial diversification; universal access to information and communications technology.

Nations around the world are increasingly giving higher importance to SDG-9, considering the sheer number of people engaged in employment activities. This can be seen in the number of firms getting ESG scores as well.

Figure 1: Employment in manufacturing as a percentage of total employment
(Source: https://sdg-tracker.org/infrastructure-industrialization)

Figure 2: Proportion of companies with an ESG Score by region
(Source: ESG Investing: Practices, Progress and Challenges (oecd.org))

India needs a sustainable switch

India, on a larger scale, has been in the upcycle in terms of economy and development. It has seen significant growth since the opening up of the Indian economy during the 1990s. The growth, though, mostly has come out of the service sector and consumption, while the manufacturing sector has seen rather sloppy growth over the years.

· In terms of unemployment, the numbers have been discouraging, too, as India currently ranks 86^th in the unemployment index in the world.

· Last fiscal indicated a 17.4% share of manufacturing in the GDP, which is up from 15.3% in the year 2000. The growth has been too less and India inc. needs to up the ante.

· The manufacturing employment rates paint an equally alarming picture as they have seen five years of constant decline. In 2016 the sector employed nearly 55 million laborers, which has now reduced by 46% and now employees only 27 million people.

· Nearly 0.7% of the GDP was spent on R&D. Unlike in advanced countries, where 70% of GERD (Gross Expenditure of R&D) contribution comes from the private sector, Indian private sector contribution is less than 40%.

· India only has 253 scientists per million inhabitants, and this is lesser than smaller Asian countries like Oman, and Vietnam.

· Global competitiveness Index: Road connectivity index rated India at 75.83 while most of the advanced economies were rated 90+

MasterCard

MasterCard has been working over the past few years to promote sustainable operations through multiple facets. These have ranged from social initiatives to bring about greater opportunities to everyone, to research into clean energy and beyond. A good chunk of this has been the impetus on encouraging innovation and developing more in-house talent and ensuring the overall well-being of all people involved in the process. Programs now include the value of innovation and collaboration as a core part.

MasterCard has adapted its people's policy remarkably well in the face of the pandemic and has leveraged its brand name and image to attract, improve, nurture, and retain the best talent. The result of this is a workforce that is very well trained and has a conducive environment to think, take the initiative, and come up with new and innovative solutions. Existing employees also underwent a fair bit of training to become more proficient with the needs of the job, and the firm has been working to develop long-term senior leaders for the firm from within the existing pool of employees.

Besides this, a number of social initiatives that MasterCard undertakes also received a strong boost in the pandemic. Some of these are listed below.

1. Youth employment and Apprenticeship programs were conducted more widely than before and were targeted at youth from the lower socio-economic sections of society in many parts of the world, including India. These programs provided financial and technological support, besides fostering a focus on career readiness and innovation in thinking.

2. MasterCard almost doubled its training program size for newly hired employees and has brought in a host of changes through new online onboarding practices (which were very positively received and successful). To augment this, programs for people looking to relaunch their careers also were launched, with a focus on upskilling and innovation.

3. Employees volunteered some time for social outreach as well, and some philanthropic contributions (to the tune of 5.633 million dollars worldwide) were made by employees.

In the bid to become more sustainable environmentally, the firm has partnered with several organizations and is a founding member of the Priceless Planet Coalition (to encourage critical afforestation). The firm has also started using environmentally sustainable materials for producing its cards, with over 10 million such cards having been issued between 2018 and 2020.

Reliance Industries Limited

Being India's biggest company Reliance Industries Limited is shouldered with ESG responsibilities and expectations. The company has delivered on multiple fronts and have covered multiple Sustainable Development Goals (SDGs) through a multitude of initiatives.

RIL's workforce has quadrupled itself from around 61000 in 2010 to 236000 in 2021. RIL created around 75000 jobs in FY21 alone. RIL has also worked towards skilling Indian workforce and have delivered 76 Lacs+ training man-hours. Reliance Industries Limited also creates around 50 Lac indirect jobs in the country.

The company also substantially spends for Research & Development and spent approximately INR 2572 Crores achieving 137 Patents and deriving a Value benefit of INR 320 Crores. As one of the report says "Now ranked among the world's best, Reliance nurtures an entrepreneurial and innovation-led mindset that equips it and the country to boldly venture into the future. At Reliance, R&D investments have resulted in several breakthrough technologies and a diverse patent portfolio. The Company's robust internal Intellectual Property (IP) governance framework ensures that these patents are aligned with the Company's business goals. In addition, an IP governance framework helps it adhere to compliance requirements." RIL has recorded great extent of bio-innovation through their R&D efforts from pioneering synthetic biology efforts in regard to next-gen bio-materials to working on bio-innovations to increase agriculture productivity by combining its expertise in photosynthesis research with AI and ML tools.

RIL has been has increasingly been looking to partner smaller businesses, start-ups and mom-and-pop stores to serve as the last mile support for Reliance's e-commerce plans. The company also connected India with Jio making internet and network accessible in terms of price and penetration as it took the technology to the remotest parts of the country. This has enabled technologies solid and rapid development of UPI which eases one-to-one, eliminating unreliable hawala system, and interacting with other platforms way easier henceforth, playing a pivotal role in digitization and giving the Indian economy a great impetus.

Analysis and suggested path ahead

Figure 3: Highlights of India related to SDG 9
(Source: https://in.one.un.org/page/sustainable-development-goals/sdg-9)

Presently, significant progress has been made to achieve the various targets under the Industry, Innovation & Infrastructure goal. One target is to build Develop quality, reliable, sustainable and resilient infrastructure, including regional and transborder infrastructure, with a focus on affordable and equitable access for all by 2030. The number of countries with more than 100 million air passengers has increased from just 4 in 2009 to 10 in 2019. Transportation of freight across the world has increased by 23% from 176 billion to 216 billion with a massive 88% in low and middle income. These two indicators highlight the massive development in infrastructure that's occurred over the last 10 years, especially in developing countries that have seen massive developmental work.

Another target is to upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes. CO2 emissions per unit GDP is an indicator used to measure the progress made and in the last 10 years, the number of countries producing more than 0.6 kg of CO2 per $ of GDP has reduced from 10 to 4 countries. However total CO2 emissions have increased by approximately 2 billion tons. This trend clearly shows despite steps taken by various countries to reduce their emissions, the growth in GDP of several countries has led to increased CO2 emissions, further threatening the environment. Moreover, as further proof of developing infrastructure and technology internet penetration increased with over 56% of the world's population having access to the internet as compared to just 26% in 2019.

Over time, encouraging developments have occurred that have helped the world move towards a more equitable and sustainable future. However, there's still a lot left to be desired. In their aim to develop rapidly and provide their citizens with a better life, many countries have adopted policies that haven't prioritised sustainability. Moreover, the carbon emission per capita of most developed countries are a lot higher than several of the developing countries. For instance, the USA emits 15 metric tons of co2 per capita as compared to India that emits just 1 metric ton.

Such clear disparities have led to difficulty in achieving international consensus on achieving various sustainability goals. Most international debates on climate change have become a way to pass the blame with Developed and developing countries approaching such events with ulterior motives and not prioritising the greater good of the world.

The EU Parliament had adopted a resolution to implement a 'Carbon Border Adjusted Mechanism' (CBAM), a June 2021 draft regulation about which proposed that goods entering the EU would be taxed at the borders. At face value, the tax tries to promote the reduction of carbon emissions by blocking market entry to countries seen as high product emitters. But it also restricts market access to developing countries that have the right to develop their economies. This conflict between sustainability and development has made it very difficult to reach a consensus and achieve significant progress on sustainability goals.

In order to achieve sustainability targets and move towards a more sustainable way of life, it's important to create a roadmap that charts out the course to a more sustainable future. Infrastructure development should be encouraged in developing countries through low-interest rate loans from international organisations like the World Bank to provide capital from such projects. The concept of green buildings and wastewater treatment plants are among the several technological improvements that can be implemented while developing infrastructure to reduce the future carbon footprint and create an environmentally sustainable future. Such technologies can be made available in developing countries through the transfer of technical know-how via the internet and funds can be provided for such initiatives through local and international funding. International help to developing countries would make them more likely to get behind emission targets and implement other sustainability measures.

Developed countries have excelled in research and development on sustainability as well as creating technological innovations that have the potential to reduce carbon emissions. However, countries, as developed as the United States of America, have continued to emit large amounts of CO2 that is several times more than the emissions of developing countries. Hence, the developed nations must take the lead in reducing carbon emissions to signal their intent. This will also give the developing countries more confidence to do the same and could pave the way for a more sustainable future.

References:

1. https://sdg-tracker.org/infrastructure-industrialization#targets

2. https://en.wikipedia.org/wiki/Sustainable_Development_Goal_9

3. https://www.business-standard.com/article/economy-policy/explained-why-india-is-protesting-eu-s-carbon-border-tax-121070800216_1.html

4. https://ourworldindata.org/grapher/number-of-air-transport-passengers-carried?tab=table&time=earliest..2009

5. https://indiaclimatedialogue.net/2020/12/11/india-pushes-back-against-strengthening-climate-pledge/

6. https://sdgs.un.org/goals

7. https://sdgs.un.org/goals/goal9

8. https://govdata360.worldbank.org/indicators/h3b01ce64?country=BRA&indicator=41361&viz=line_chart&years=2017,2019

9. https://www.outlookindia.com/website/story/business-news-gdp-data-the-story-of-indias-manufacturing-sector/393296

10.https://www.business-standard.com/article/economy-policy/ceda-cmie-bulletin-manufacturing-employment-halves-in-five-years-121050601086_1.html

11.https://economictimes.indiatimes.com/news/india/nearly-0-7-pc-of-gdp-spent-on-rd-strengthening-of-st-infra-from-2014-15-to-2018-19-govt/articleshow/85212365.cms?from=mdr