Scope for Reducing CO2 Emissions of Indian Manufacturing: Its Likely Impact on Export Competitiveness

Bishwanath Goldar () and Meera Bhalla ()
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Bishwanath Goldar: Institute of Economic Growth, University Enclave, New Delhi, Delhi 110007, India
Meera Bhalla: India Infrastructure Publishing Limited, B-17, Qutab Institutional Area, Institutional Area, New Delhi, Delhi 110016, India

Journal of International Commerce, Economics and Policy (JICEP), 2015, vol. 06, issue 03, 1-27

Abstract: This paper explores how reductions in carbon dioxide (CO2) emissions of Indian manufacturing would impact the export competitiveness of Indian manufacturing firms, by estimating production functions of alternate specifications using data on manufacturing companies for 2007–2008. The results indicate substantial scope for reduction in CO2 emissions through factor substitution and reduction in technical inefficiency. The analysis presented in the paper indicates that a reasonable carbon tax of US$ 4–15 per tonne of CO2would cause costs in industrial companies to increase, on average, by 0.36%–1.33% and the consequent loss of exports because of the carbon tax is likely to be small.

Keywords: CO2 emissions; carbon tax; export competitiveness; factor substitution; Indian manufacturing; F18; Q52; Q53 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (1)

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DOI: 10.1142/S1793993315500180

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