Political Economy of Low Carbon Investment in China and India

This project investigated whether and how coalitions of public, private and civic actors influence low carbon investment.

  • It is clear that the low carbon transition requires enormous investment in new technology, especially private investment. It is not yet clear how to generate this investment.
  • The dominant approach is top-down, but it appears to be at an impasse. It relies on establishing new global rules for reducing carbon emissions and assumes that private investment will follow.
  • This approach cannot explain the substantial investments that have occurred in some countries and sectors. And it is unlikely to trigger the investments needed in the future.
  • In order to capture the emerging economic and political dynamics, this project experimented with a bottom-up approach.
  • We focused on the (changing) alignments of interest between investors and policy makers (and civil society groups) at the local and national level and their influence on the positioning of enterprises and their investments.
  • We obtained the required investment data from the Bloomberg New Energy Finance group and investigated who/what explains the turning points in investment by interviewing key actors.
  • The project focused on investment in the wind and solar power sectors in China and India. China is now the World No. 1 investor and India has had the highest growth rate in 2011.

Project details

start date
2 April 2012
end date
31 March 2016
£ N/A


About this project

China India


Recent work


What Drives Wind and Solar Energy Investment in India and China?

IDS Evidence Report 87

This research is motivated by the need to transform the basis of energy systems from fossil fuels to renewable sources. As well as the imperative of climate change, this transformation is needed to create development trajectories for economies that are genuinely sustainable over the long term....

31 July 2014