Australia-India Clean Energy Partnership

Source: The post “Australia-India Clean Energy Partnership” has been created, based on “Powering up the Australia-India clean energy partnership” published in “The Hindu” on 15 October 2025. Australia-India Clean Energy Partnership.

UPSC Syllabus: GS Paper 2 – International Relations

Context: India and Australia are both pursuing ambitious clean energy targets to address climate change and ensure energy security. The India–Australia Renewable Energy Partnership (REP), launched in 2022 by Prime Ministers Narendra Modi and Anthony Albanese, marks an important framework for cooperation in this sector. The recent visit of Australian Climate and Energy Minister Chris Bowen to India provides a key opportunity to move this partnership from vision to implementation.

Climate Change and the Need for Clean Energy Transition

1. The Indo-Pacific region faces severe climate challenges, with nearly ten climate-related disasters per year between 1970 and 2022, leading to major human and economic losses.
2. By 2050, around 89 million people in the region could be displaced due to climate change impacts.
3. India has pledged to achieve 500 GW of non-fossil electricity capacity by 2030, and it has already achieved nearly half of this target.
4. Australia has committed to reducing emissions by 62–70% below 2005 levels by 2035, aligning itself with global net-zero ambitions.

The Challenge of Supply Chain Vulnerabilities and Overdependence

1. The global clean energy transition depends heavily on critical minerals, solar components, batteries, and hydrogen technologies.
2. At present, China dominates the global supply chain, refining over 90% of rare earth elements and producing nearly 80% of global solar modules.
3. This concentration creates a strategic risk, as disruptions such as those during the COVID-19 pandemic can impact global renewable energy production.
4. India’s dependence is visible in electric mobility and wind power sectors, where imports of rare earth magnets and batteries are unavoidable.
5. Australia, though rich in lithium and rare earths, lacks large-scale refining and downstream processing capabilities.

The India–Australia Renewable Energy Partnership (REP)

1. The REP aims to convert climate ambition into actionable cooperation between India and Australia.
2. It focuses on joint projects, critical mineral collaboration, capacity building, and knowledge sharing.
3. The partnership promotes cooperation in areas such as solar photovoltaic technology, green hydrogen, energy storage, circular economy, and two-way investments.
4. It also proposes the establishment of a 1.5 Dialogue involving policymakers, researchers, and industry leaders to facilitate practical and institutional collaboration.

Strengths of Both Partners

1. Australia’s strengths lie in its vast reserves of critical minerals like lithium, cobalt, and rare earths, as well as in its strong regulatory framework and research capacity.
2. The Net Zero Jobs Plan of Australia emphasizes developing skilled workers required for the clean energy transition.
3. India’s strengths include its large domestic market, manufacturing capacity, and demographic advantage with nearly two-thirds of its population under 35 years of age.
4. Government initiatives such as the Production Linked Incentive (PLI) scheme and Skill India program enhance India’s ability to manufacture, install, and maintain clean energy systems.

Potential Benefits of the Partnership

1. The collaboration can help diversify global supply chains and reduce dependence on a single country.
2. It can create a regionally anchored and resilient clean energy ecosystem in the Indo-Pacific.
3. Joint investment in processing infrastructure can strengthen the clean energy value chain in both countries.
4. The partnership can generate green jobs and enhance energy security for both economies.
5. It demonstrates how democratic nations can cooperate to achieve shared climate and sustainability goals.

Challenges in the Australia–India Clean Energy Partnership

1. Overdependence on a single country: Both nations rely on China for critical minerals, solar components, and batteries, creating vulnerabilities in supply chains.
2. Lack of downstream processing capacity: Australia has abundant raw materials but limited refining and manufacturing facilities, while India’s battery and component industries are still developing.
3. Technology and R&D gaps: High-end technologies such as green hydrogen and energy storage are capital-intensive, and both nations need to bridge innovation gaps through joint research.
4. Regulatory and policy divergence: Differences in energy policy frameworks, environmental regulations, and investment rules can slow down collaboration.
5. Financing constraints: Clean energy projects require long-term affordable finance, and private investment remains limited due to high risks and uncertain returns.
6. Geopolitical factors: Strategic tensions in the Indo-Pacific region and dependence on global maritime routes can affect energy security cooperation.
7. Skill and capacity limitations: Both nations must strengthen training programmes to develop skilled manpower for clean energy manufacturing and maintenance.
8. Implementation and coordination issues: Without strong institutional mechanisms, the REP risks remaining declaratory rather than outcome-oriented.

Way Forward

1. Both nations should prioritize joint R&D initiatives in hydrogen, battery storage, and renewable technologies to close innovation gaps.
2. Australia can invest in critical mineral processing facilities in India to develop resilient supply chains and value addition.
3. There is a need for harmonized regulatory frameworks and green finance mechanisms to facilitate private investment and long-term sustainability.
4. Institutionalizing an annual India–Australia Clean Energy Dialogue can ensure policy continuity, monitoring, and effective project execution.
5. Strengthening skill development collaborations under Skill India and the Net Zero Jobs Plan can build a competent workforce for the clean energy transition.

Conclusion: The Australia–India clean energy partnership has the potential to transform shared climate ambitions into tangible results. By combining Australia’s resource base and technological capacity with India’s scale and skilled workforce, both countries can drive a sustainable energy transition.Effective implementation of the REP can build diversified, stable, and secure clean energy supply chains, contributing to regional stability and global climate action.

Question: Powering up the Australia–India clean energy partnership can create a resilient and regionally anchored clean energy ecosystem. Discuss.