CCUS Could Anchor India’s Net-Zero Strategy, but Finance and Regulation Must Come First

India’s emissions profile — shaped by heavy reliance on coal-fired power, cement production, and steel manufacturing — presents a decarbonisation challenge that solar and wind expansion alone cannot resolve. An economist affiliated with IIT Madras contends that Carbon Capture, Utilisation, and Storage (CCUS) technologies, applied across these hard-to-abate sectors, are essential if the country is to reach net-zero targets while maintaining industrial growth momentum.

The analysis advocates a phased deployment model: near-term retrofits of existing high-emission plants with post-combustion capture systems, followed by integrating pre-combustion capture and oxyfuel combustion into new facilities at the design stage. Direct Air Capture (DAC) is identified as a longer-horizon option warranting pilot investment now, given its currently prohibitive costs, before broad commercial rollout becomes viable. Industrial clusters in Maharashtra, Gujarat, and Tamil Nadu are proposed as priority geographies for early deployment, with national expansion to follow as technology matures and unit costs fall.

Unlocking CCUS at scale is framed fundamentally as a financing and governance problem. The proposed framework blends government subsidies and tax incentives with carbon pricing instruments — including carbon taxes and cap-and-trade schemes — alongside public-private partnerships, international climate finance, green bonds, and carbon credit markets. A clear regulatory regime covering the full CCUS value chain — capture, transport, utilisation, and long-term underground storage — is identified as a prerequisite for mobilising private capital. The economic case extends beyond emissions reduction: captured CO₂ converted into synthetic fuels, chemicals, and construction materials is presented as the basis for new industrial value chains and broad-based employment creation.