Sectoral approaches to decarbonisation

Sectors Driving Sustainability

The Confederation of Indian Industry (CII) represents India's industrial voice at global summits such as the COP conferences. It curates panels with leaders from different sectors and sizes of industry to present India’s perspective, especially on food security and the need for nationally determined goals that protect small farmers. As an innovator of the global South (India and Africa), India faces disproportionate impacts from climate extreme events, making local, sustainable interventions critical.

Case Study 1: Millets (Ragi) – Odisha Millets Mission

The humble millet (locally called Ragi) is a climate-resilient, nutrient-rich crop. In the Dhenkanal district of Odisha, under the Odisha Millets Mission, women’s self-help groups (SHGs) tackled key challenges:

• Lack of access to quality seeds and farming inputs
• Inadequate storage and infrastructure (pests, rain damage)
• Low awareness among farmers about millet cultivation
• Limited product diversification, innovation, and value addition

Interventions:

• Sensitisation and value-addition training for 20 SHG members
• Packaging and marketing support (events, exhibitions)
• Supply to midday meals in schools and Anganwadi centres
• Formation of 5 FPOs (Farmer Producer Organisations)

Impact:

• Millet cultivation increased by 1,000 hectares across five blocks
• 1,500 tribal households reached
• Products developed: Ragi powder, Ragi Laddoos, Ragi Cookies, Ragi Mudki

Financial outcome (example – Ragi powder):

Value addition boosted revenue and profitability. The project also built awareness that millets are sustainable and improve maternal and child nutrition.

Exam tip: Linking government schemes (e.g., Odisha Millets Mission) to SME interventions is a recurring theme. Understand how state-level policies create entrepreneurial opportunities in aspirational districts.

Key takeaways

• Millets are climate-resilient and sustainable; government missions enable value addition at the grassroots.
• Self-help groups and FPOs are powerful vehicles for scaling impact.
• Even small-scale processing (e.g., Ragi powder) can increase profit margins significantly.
• Awareness, training, and market linkage are critical to overcoming farmer challenges.

Case Study 2: Handicrafts – Dhokra, Straw Craft, Tribal Jewellery, Bamboo

India’s artisans are globally renowned, but they face severe competition from automated production, especially from factories using synthetic materials. For example, the famous Channapatna wooden toys (made from traditional wood and vegetable dyes) now compete with cheaper automated toys made from sawdust and glue, which are toxic and lack sustainability.

Challenges:

• Increased cost of raw materials
• Low profit margins due to competition from automated mass production
• Lack of awareness of market-relevant designs
• Ignorance of government schemes
• Behavioural and social issues among artisan communities

Interventions:

• Collaboration with the Handicrafts Department and ORMAS (Odisha State Government ecosystem)
• Market research to guide design: smaller, gift-friendly sizes (e.g., desktop elephants)
• Setting up raw material banks at artisan villages
• Selling through the One Station One Product (OSOP) stores at railway stations

Impact (example – Dhokra item):

The OSOP scheme provides a ready sales channel; visiting these stores is a practical way to understand local products and market demand.

Exam tip: Competition from automated imports is a common threat. Differentiation through authenticity, eco-friendliness, and government-supported retail (OSOP) can help SMEs thrive.

Key takeaways

• Handicraft SMEs must innovate on design and size to meet modern market preferences.
• Raw material banks reduce input cost volatility.
• The One Station One Product scheme is a direct, low-cost retail outlet for artisans.
• Entrepreneurs should cultivate curiosity: ask what sells, what doesn’t, and why.

Case Study 3: Cashew Nuts – Processing Unit Challenges

Cashew is a high-value cash crop, but processing is labour-intensive and faces multiple barriers.

Challenges:

• Huge capital investment required for processing units
• Complexity of grading, packaging, and shelf-life management
• Export regulations, tariff and non-tariff barriers (environmental, social)
• Seasonal supply vs. year-round demand
• Lack of skilled labour in processing units

Interventions (project-based):

• Awareness campaigns to bridge demand-supply gap
• Proposals to Regional Industries Centres to set up processing units
• Value addition training
• Provision of loans under the PMFME (Pradhan Mantri Formalisation of Micro Food Processing Enterprises) scheme

Impact:

• Mitigation of demand-supply gap
• Promotion of value-added products
• Speedier loan disbursement under PMFME

Exam tip: The PMFME scheme is a central government financing instrument for micro food processing SMEs. Understand its role in supporting value addition.

Key takeaways

• Cashew processing units are capital- and skill-intensive; government loans and training can de-risk entry.
• Value addition (grading, packaging, shelf-life extension) is essential to compete in export markets.
• Seasonal cycles require smart inventory and supply chain management.

Case Study 4: Jackfruit – Sakrepatna Jackfruit Forum

In Sakrepatna (Chikmagalur district, Karnataka), jackfruit was going to waste despite abundant harvests. Entrepreneurs Nara Kumar (NG Fruits) and Sachidananda Nayak (Vajra Biotech) formed the Sakrepatna Jackfruit Forum to reduce wastage and maximise value.

Interventions:

• Set up a cold supply chain for pulping and storage
• Developed value-added products from jackfruit
• Created new business opportunities while saving a traditional crop

Impact:

• Reduced jackfruit waste
• Employment for ~30–40 people
• New skill courses developed for agriculture and allied communities
• Became a role model for local entrepreneurship

The key message: local is the way to go. Entrepreneurs who understand the local ecosystem, culture, and communication can lead by example, inspiring neighbours and classmates to start their own ventures.

Key takeaways

• Jackfruit is an underutilised crop; cold chain and value addition can turn waste into profit.
• Local leadership (“be a role model”) multiplies impact by inspiring others.
• Entrepreneurship in familiar regions reduces risk and leverages local knowledge.
• SMEs can integrate sustainability into the value chain by saving traditional crops.

---

Cross-Cutting Themes and Final Takeaways

The four case studies illustrate a consistent pattern: SMEs in agriculture, handicrafts, and food processing can achieve sustainability and growth through value addition, government scheme awareness, and local ecosystem engagement.

Unifying principles:

• Policy awareness is non-negotiable – schemes like Odisha Millets Mission, OSOP, and PMFME provide concrete support.
• Value addition transforms raw commodities into higher-margin products.
• Local ecosystems – culture, language, trust – are competitive advantages.
• Curiosity and failure tolerance (asking “why didn’t this work?”) are essential entrepreneurial mindsets.

Exam tip: Always link SME challenges to specific government schemes. For any sector, be ready to suggest a plausible intervention (training, financing, market access, infrastructure). The module emphasises that these are real, replicable models.

Final key takeaways

• SMEs can drive decarbonisation and sustainability indirectly by preserving traditional, low-emission practices and reducing waste.
• Every state and district has unique schemes; entrepreneurs must actively research (newspapers, government websites, railway station stores).
• The global South’s vulnerability to climate extremes makes local, resilient value chains urgent.
• Small-scale success stories (like Sadhana Deshmukh’s soy milk from a katori) demonstrate that persistence and local resourcefulness pay off.

Decarbonisation and Climate Change

Burning fossil fuels (coal, diesel, petrol) releases carbon dioxide (CO₂) and other gases into the atmosphere. These gases trap heat like a glass panel in a greenhouse—this is the greenhouse effect, the primary driver of climate change. Decarbonisation means systematically cutting those emissions: shifting to renewable energy, improving efficiency, and redesigning processes to minimise waste. It is a long-term pathway, not a short-term fix. For SMEs, embedding decarbonisation goes beyond compliance—it must become part of every operational decision.

Carbon Emissions and the Climate Challenge

Fossil fuel combustion releases CO₂, which accumulates in the atmosphere. The greenhouse effect raises global temperatures, destabilising weather patterns, ecosystems, and economies. The logic: more fossil fuel use → more trapped heat → accelerated climate change.

Decarbonisation – the systematic reduction of greenhouse gas emissions, especially CO₂, by transitioning to renewable energy, improving efficiency, and redesigning processes to cut waste.

The Challenge of Transition

Moving from fossil fuels to renewables is difficult. Countries face:

• Job impacts – e.g., coal mines in India employ many; closing them requires large-scale reskilling and job relocation.
• Scale – the shift must happen across every sector, not just energy.
• Data and technology – positive steps exist, like India’s mandate for listed companies to report carbon footprints, providing unique data for monitoring. Technology can help make sustainability affordable.

Analogy: Decarbonisation is like adopting a healthier diet. Excess carbon emissions = excess calories, destabilising the planet. Cutting “carbon calories” makes enterprises resilient, competitive, and future-ready.

India’s Panchamrit Commitments

At the 2021 Glasgow Climate Summit, India announced five transformative promises—Panchamrit (Sanskrit for “five nectars”). These guide India’s decarbonisation pathway and directly affect SMEs.

Exam tip: The five Panchamrit targets (especially numbers and years) are high‑yield. Expect questions linking them to SME opportunities and regulatory pressure.

Practical Example: Water and Energy

Consider water in urban high‑rises. Pumping water to upper floors consumes significant electricity—every litre moved adds to the building’s carbon footprint. When constructing an SME unit, think about:

• How water is moved and stored.
• The energy used for pumping.
• Minimising waste at the design stage.

Such minute details accumulate when calculating an enterprise’s carbon footprint. They demonstrate to stakeholders (upstream and downstream) that sustainability has been considered from the start.

Key takeaways

• Greenhouse effect from fossil fuel CO₂ drives climate change; decarbonisation is the long‑term solution.
• Transitioning is complex due to job displacement, scale, and cost, but data tools and mandates (e.g., India’s reporting rule) are emerging.
• India’s Panchamrit commitments set concrete 2030 targets: 500 GW non‑fossil capacity, 50 % renewable electricity, 1 billion ton emission reduction, 45 % lower carbon intensity, and net zero by 2070.
• SMEs must treat decarbonisation as a strategic, long‑term embedded practice, not a short‑term compliance checkbox.
• Small operational choices (e.g., water pumping) contribute to carbon footprint and matter to investors and customers.

Stakeholder Mapping

Stakeholder mapping identifies the actors relevant to a business’s decarbonisation efforts, their interests, and the networks they operate in. Intuitively: you cannot manage what you do not see — if you miss a key stakeholder, your strategy fails.

Stakeholders are individuals or groups who have an interest in or are affected by a business's decisions. Examples:

• Owners seeking profits
• Employees wanting fair wages
• Customers demanding quality
• Communities expecting responsible behaviour (e.g., not discharging harmful waste water into local drainage or emitting toxic fumes from a factory chimney)

In the sustainability context, stakeholders set expectations, regulators enforce rules, financiers evaluate risks, NGOs advocate for environmental responsibility, the media communicates responsibly, and international bodies shape global policy. Stakeholders both drive and respond to decarbonisation — they demand standards, then scrutinise implementation against benchmarks.

Exam tip: The core reason for stakeholder mapping is that unmapped stakeholders lead to unmanaged risks. Memorise the three-why test: Who is important? Why? How to address their concerns?

Three categories of stakeholders

For an SME in India, sectoral stakeholders include bodies like the Confederation of Indian Industry (CII), FICCI, NASSCOM (IT), or SIAM (automotive). These associations provide sector-specific guidance and collective influence.

Networks and agencies — creating an ecosystem of support

SMEs often lack resources to act alone. Networks and agencies provide:

• Technical knowledge
• Funding opportunities
• Policy guidance
• Platforms for collaboration

Key global and national bodies:

• UNFCCC (United Nations Framework Convention on Climate Change) — facilitates global negotiations
• IPCC (Intergovernmental Panel on Climate Change) — provides scientific assessments, including annual alarming reports on the 1.5°C warming threshold
• SBTi (Science-Based Targets initiative) — a partnership of CDP, UN Global Compact, WRI, and WWF. Helps companies set GHG reduction targets consistent with the Paris Agreement. For SMEs, SBTi offers simplified pathways reducing measurement and reporting complexity. Adopting SBTi targets brings international recognition, credibility with investors and customers, and access to global supply chains.
• NITI Aayog — provides strategic direction for India’s decarbonisation agenda
• Ministry of MSMEs — supports small firms in adopting sustainable practices
• Industry associations (CII, FICCI) — create guidelines, training, and certification programs for SME decarbonisation

Practical example: The NSRCEL (IIM Bangalore’s incubator) recently posted a call for SMEs to collaborate with Maruti Suzuki on circular economy — reusing, restructuring, or refurbishing components. NSRCEL acted as the platform enabling such sectoral collaboration.

Sectoral clusters and alliances (e.g., in textiles, renewable energy, manufacturing) help SMEs share solutions, pool resources, and create scale — reducing costs and accelerating innovation.

How SMEs can engage:

1. Join industry associations
2. Participate in sectoral clusters
3. Apply for government schemes
4. Align with global frameworks like SBTi

Multidisciplinary collaboration — why it matters

Decarbonisation is too complex for one sector or discipline alone. It requires collaboration across engineering, management, policy, finance, and design.

Example from Siemens (senior sustainability leader): Siemens replaced existing materials with green metals in their Frankfurt factory and tackled upstream (sourcing) and downstream (waste management). For the thermoplastic components in MCB switches (used in electricity meter switchboards), they found a collaborator outside their industry — the cement industry — which bought the waste to produce blended cement. This illustrates going beyond the value chain and the power of cross-sector collaboration.

Roles of specific professionals:

Worked collaboration example – rooftop solar installation in an SME:

Exam tip: The Siemens–cement industry example is a classic illustration of cross-sector collaboration for circular economy. Remember the mechanism: thermoplastic waste → cement industry → blended cement.

Key takeaways

• Stakeholder mapping answers: who matters, what do they want, how to engage.
• Three categories: internal, external, sectoral (industry associations).
• Networks (NSRCEL, SBTi, CII) create ecosystems that help SMEs overcome resource gaps.
• Multidisciplinary collaboration (engineers + managers + financiers + policy + designers) turns technical solutions into viable business practices.
• Going beyond the value chain — collaborating with unrelated sectors — can unlock circular economy opportunities.

Sectoral Approaches to Decarbonisation

Decarbonisation does not look the same across industries. Manufacturing, food, retail, logistics, construction, and services each face unique emission profiles, regulatory pressures, and cost structures. Sectoral approaches tailor strategies to be both practical and impactful.

Small and medium enterprises (SMEs) operate in every sector and collectively form the backbone of national productivity. Sectoral strategies must consider how SMEs can implement decarbonisation affordably and effectively.

Why Sectoral Approaches Are Needed

---

Manufacturing SMEs

Challenges: High energy intensity, cost & knowledge gaps for advanced tech.

Opportunities:

• Energy efficiency improvements (e.g., modern induction furnaces)
• Renewable energy adoption (rooftop solar)
• Waste reduction & circular economy (recycling scrap, industrial symbiosis)
• Switching to cleaner fuels, efficient machinery

Worked example (metal-working SME)

• Installs energy-efficient induction furnace → reduces electricity consumption ~30%.
• Adds rooftop solar panels → supplies significant daily power, lowering fossil fuel dependence.
• Implements material recovery system → scrap metal segregated and sold to recyclers, closing the loop.

Aligning with SBTi (Science Based Targets initiative) helps manufacturing SMEs demonstrate commitment and integrate into international supply chains demanding sustainability reporting.

---

Food & Agriculture SMEs

Challenges: Emissions from cultivation, processing, packaging, transport; food waste → methane.

Opportunities:

• Sustainable sourcing (local, low-impact suppliers)
• Improved energy use in processing and cold storage (efficient refrigeration)
• Reduced packaging waste
• Cutting food waste along the supply chain — most impactful opportunity
• Mission LiFE (Lifestyle for Environment): promote responsible consumption, nutritious diets, waste calculators in canteens

Worked example (food processing SME) Installs energy-efficient refrigeration, sources from local sustainable farmers, introduces composting for food waste → reduces emissions, strengthens brand reputation.

Field visits (e.g., to a sustainable farm) help employees internalise the effort behind food, reducing waste.

---

Retail & Consumer Goods SMEs

Challenges: Packaging, store energy use, complex supply chains — emissions at every stage.

Opportunities:

• Green supply chains
• Eco-friendly packaging (biodegradable)
• Energy efficient lighting and cooling (LED, smart systems)
• Digital tools to reduce paper and optimise logistics
• Carbon labelling to empower informed consumer choices

Behavioural call-out: Think before clicking "add to cart". Consider carbon footprint of last-mile delivery. Avoid unnecessary single-item deliveries; plan monthly shopping instead.

Fast fashion is a major issue — shoes and clothes end up in landfills, often non‑biodegradable.

Worked example (clothing retailer) Switches to biodegradable packaging, installs LED lighting, partners with low-emission suppliers → lowers footprint, attracts eco‑conscious customers.

---

Logistics & Transport SMEs

Challenges: Heavy reliance on diesel vehicles, inefficient routing, fragmented operations; high cost of clean transport transition.

Opportunities:

• Route optimisation software
• Shift to electric vehicles (pilot small fleets)
• Shared logistics platforms (reduce empty miles)
• Fuel‑efficient driver training

Real‑world example (automobile giant) Reduced lorry travel time from Bangalore to Delhi from 30 to 28 days through better route planning — improved efficiency and lowered carbon footprint.

Worked example (delivery SME) Adopts route optimisation software, pilots electric vans, trains drivers in fuel‑efficient practices → lower cost and reduced emissions.

---

Construction & Real Estate SMEs

Challenges: Emissions from cement, steel, bricks; construction waste; building energy use.

Opportunities:

• Low‑carbon building materials: fly ash bricks, recycled steel, alternative cement blends
• Energy‑efficient design: natural lighting, ventilation to reduce electricity demand
• Waste recycling: reuse concrete debris, wood, metal → close the material loop

Worked example (construction materials supplier) Integrates fly ash bricks, recycled aggregates, blended low‑carbon cements. Promotes building layouts maximising daylight and natural ventilation. Onsite waste segregated and recycled → lower emissions, lower costs, stronger reputation.

Reputation effect: once an SME is known for sustainable waste management, clients seek its services for debris disposal.

---

Services & IT SMEs

Challenges: Electricity for data servers, digital infrastructure, business travel, employee commuting, office supplies — less visible but substantial indirect emissions.

Opportunities:

• Transition to renewable energy for offices and servers
• Energy‑efficient equipment (laptops, printers, smart lighting)
• Digitisation: cloud platforms, reduce paper
• Flexible work arrangements (remote/hybrid) → cut commuting and travel
• Sustainable procurement policies for supplies, catering, outsourced services

Worked example (IT consultancy) Moves servers to a green cloud provider, adopts energy‑efficient laptops, reduces air travel through virtual meetings → cuts emissions and lowers costs.

---

Integrating Strategies: Cross‑cutting Principles

• Robust waste management conserves resources and reduces disposal emissions.
• Mission LiFE (behavioural philosophy) aligns SMEs with national priorities and encourages sustainable consumer choices.
• Science‑Based Targets initiative (SBTi) benchmarks enhance credibility and access to international markets demanding climate responsibility.

Key takeaways

• Each sector (manufacturing, food, retail, logistics, construction, services) has distinct emission sources and feasible interventions.
• SMEs can act through energy efficiency, renewable energy, waste circularity, sustainable sourcing, and low‑carbon logistics.
• Mission LiFE and SBTi are key frameworks for credibility and alignment.
• Worked examples show that practical, low‑cost changes (LED lighting, route optimisation, solar, fly ash bricks) deliver measurable emissions cuts and cost savings.
• Responsible consumption (e.g., reducing fast fashion, minimising last‑mile deliveries) is a cross‑sector behavioural lever.

SMEs and the Journey to Net Zero

Net zero means achieving a balance between greenhouse gases (GHGs) released into the atmosphere and those removed or absorbed. Intuitively, every tonne of emission a business or country produces must be matched by actions that neutralise or absorb that same amount.

$\text{Net emissions} = \text{Emissions released} - \text{Emissions removed} = 0$

This balance is the core of climate mitigation: adopting renewable energy, improving efficiency, and protecting carbon-absorbing forests. When emissions and removals are equal, net zero is achieved.

Analogy: Net zero is like balancing a financial budget. Emissions are expenses, removals are income. If expenses exceed income, there is a deficit. When they balance, the climate budget is neutral.

---

Why Net Zero Matters

The Paris Agreement set the target of limiting global warming to well below 2 °C. Reaching net zero by mid-century is essential to meet this goal. G20 countries, responsible for most global emissions, have committed to different net zero timelines – making it a shared international responsibility.

India’s context:

• India accounts for 18 % of the world’s population but only 4 % of global freshwater resources → disproportionately vulnerable to climate impacts.
• At COP 26, India announced the Panchamrit commitments, including achieving net zero by 2070.
• SMEs (Small and Medium Enterprises) are the backbone of India’s industrial and service landscape. Their collective emissions are large, so without SME participation no country can realistically meet its net zero goal.

Exam tip: The connection between national net-zero targets (e.g., India’s 2070) and SME engagement is a recurring theme. Be ready to explain why SMEs are “essential actors”.

---

Emissions: Scope 1, 2, 3

Emissions are categorised into three scopes:

Analogy: Emissions as expenses

• Scope 1 = direct expenses you pay yourself (e.g., fuel).
• Scope 2 = utility bills for electricity/water.
• Scope 3 = hidden costs across your supply chain – often the largest but hardest to control, just as hidden costs can overwhelm a budget.

Scope 3 often dominates an SME’s carbon footprint but is also the most challenging to measure and influence.

---

SMEs: Current Position, Challenges, and Opportunities

Current position: Most SMEs across G20 countries are at the very beginning of their net zero journey – simple actions like LED lighting, a few solar panels, or reducing visible waste. These are important starting points but not full alignment.

Challenges:

• Financial constraints: Limited resources to invest in new technologies and scaling up.
• Technical knowledge gaps: Difficulty measuring and reporting emissions.
• Lack of standardised reporting systems: Cannot easily demonstrate progress.

Opportunities:

• Cost savings: Efficient technologies lower energy bills and protect against rising fuel/electricity costs.
• Market differentiation: Sustainability attracts conscious consumers.
• Supply chain access: Large companies and governments favour suppliers with credible climate actions – some even finance initiatives (e.g., rooftop panels).
• Resilience: Investing in climate adaptation and resilience (key course terms) ensures long-term survival and competitiveness.

Net zero is not only a climate target – it is a business opportunity for growth and resilience.

---

Sustainability Reporting for SMEs

Sustainability reporting is when a company openly communicates its environmental, social, and governance (ESG) performance.

Why it matters:

• Builds trust and transparency with customers, investors, and policymakers.
• Customers want to know if products are sustainable.
• Investors need to see climate risk management.
• Policy makers need evidence that businesses support climate goals.
• Prepares SMEs for future regulations and keeps them competitive.

Simplified pathways: SMEs can start with essential indicators (energy use, emissions, waste) without overwhelming technical details, then expand gradually.

---

Reporting Frameworks

Link between reporting and net zero: By reporting emissions and sustainability practices, SMEs create a record of their journey and can set clear targets. Frameworks like SBTi give external credibility.

---

Practical Steps: Four‑Step Pathway

1. Measure what matters – Start with the most impactful metrics: electricity consumption, fuel usage, waste segregation. Simple measurement is the foundation.
2. Report small wins – Don’t wait for perfection. Communicate early successes (solar panels, reduced packaging, recycling) with numbers to build momentum and attract collaboration.
3. Gradually adopt formal frameworks – Move toward GRI, BRSR, or SBTi over time. This signals seriousness to investors and supply chains.
4. Link reporting to action – Always connect reported figures to real outcomes. If energy efficiency is reported, show cost savings. If renewable adoption is reported, highlight emissions reduced.

Example: A small food processing business switching to efficient cold storage reduces energy costs and emissions simultaneously – a direct link between action and reporting.

---

Key takeaways

• Net zero = emissions released = emissions removed; essential for Paris Agreement goals.
• Emissions are categorised into Scope 1 (direct), Scope 2 (purchased energy), Scope 3 (value chain) – often largest.
• SMEs face financial, knowledge, and system barriers but can turn net zero into a competitive advantage.
• Sustainability reporting (GRI, BRSR, SBTi) builds trust and prepares SMEs for future mandates.
• The four‑step pathway – measure, report small wins, adopt frameworks, link to action – makes the journey manageable and impactful.

On-the-Ground Perspectives: Young Sustainability Leaders on SME Decarbonisation

This section draws on interviews with Navaneeth Ganesh (worked in Bangalore Urban) and Srinidhi Gurunath (worked in Chikkamagaluru), both alumni of the Mahatma Gandhi National Fellowship (MGNF) at IIM Bangalore. Their two-year immersion in district-level skill planning revealed how SMEs can embed sustainability in local ecosystems while accessing global markets.

---

Navaneeth: The Policy & Market Push for Green Transition in Urban SMEs

Why an SME would turn to sustainable production

A key tension: SMEs operate on thin profit margins and aim to be cost leaders. Green technology transitions — new equipment, certifications, compliance — appear costly. Yet the pull of global supply chains and the push of policy make sustainability unavoidable.

Exam tip: The primary driver for Indian SME sustainability is access to export markets, not domestic regulation. Fines for non-compliance can reach 40%, wiping out India’s cost advantage.

India’s dual pressure: global markets + domestic policy

India cannot afford to delay decarbonisation: as a country of the Global South close to the equator, it will feel climate impacts first — even if “matured markets” caused more historical emissions.

Strategic advantage of early green transition

• Green infrastructure attracts financing and interest.
• Domestic corporates (e.g., Tata Steel) targeting net zero by 2030–2040; their SME suppliers must follow.
• Green supply chains are the direction of the world; early movers gain competitive edge.

---

Srinidhi: The Jackfruit Cluster of Chikkamagaluru — A Rural SME Sustainability Model

Chikkamagaluru: biodiversity & ecosystem services

• Part of the Western Ghats, 250 km from Bangalore.
• Contains: coffee plantations, forests (Kudremukha, Bhadra), grasslands, paddy/ragi fields, plantation crops (arecanut, rubber, silver oak).
• Provides critical ecosystem services:
  • Provisioning: water (5–6 rivers feed Karnataka & Andhra), food, medicinal plants, timber.
  • Regulating: carbon storage, air quality, soil erosion control, water cycling, monsoon influence.
  • Cultural: spiritual sites, ecotourism.
  • Supporting: soil formation, nutrient cycling.

Any industry in such a region must consider how it affects or enhances these services.

Sakrepatna & the Ayyanakere lake

• Second largest lake in Karnataka: can supply the region for up to three years when full.
• Microclimate enables jackfruit to thrive — 72 different species found in Sakrepatna alone.

Why jackfruit matters for sustainability

The challenge: shift from subsistence to market economy

• Farmers increasingly cut down jackfruit trees in favour of cash crops (e.g., arecanut) — giving 5–6× the return per parcel.
• Jackfruit tree provides only ~₹1,000/year to a farmer (via middlemen).
• Value-chain products underdeveloped; jackfruit considered a low-income crop.

The response: organisation & value addition

A Sakrepatna Jackfruit Co-operative (with district officials, local experts) identified 29 value-added products, e.g.:

• Tender jackfruit → meat substitute for vegan markets
• Bulbs sold separately
• Popper, chips, fruit leather, dosa
• Jaffee (coffee substitute from seeds)
• Rotten jackfruit → biogas + manure

Strategic steps taken

On-the-ground implementation

• District Skill Committee (headed by District Commissioner) includes entrepreneurs.
• Jackfruit Mela to showcase products and educate farmers about potential income.
• Sustained beyond fellowship: MLA support, continued marketing.

Sustainability measures at the processing unit (example: NG Fruits, Vajra Biotech)

• Energy: Solar rooftop panels, energy conservation.
• Water: Efficiency measures; resilience to power outages (climate extremes).
• Workforce: Migratory workers — safe conditions, nutritious meals.
• Construction: Asbestos sheets in monsoon-prone area (heat trap but acceptable in this climate).
• Shelf-life extension: R&D with CFTRI (Mysore) — organic processing gives 3–6 month shelf life.
• Cold storage: Stores pulp for 6–8 months, enabling year-round value addition.

These incremental sustainability measures become compliance evidence for export markets.

---

The NCERT Textbook: Embedding Climate Education Early

Both speakers contributed to the NCERT textbook on climate education (Class 6–8, CBSE).

Key features:

• “Meet the Expert” sections — students visit farms, nurseries, talk to local practitioners.
• Discovery of local wisdom: e.g., biofuel from kitchen waste, using own animals, traditional practices.
• Validation (Vyasa Shiksha): local family members called as experts; reinforces value of traditional knowledge.
• Illustrations (Srinidhi’s role): ensure representation of native species (cows, goats, plants) across India — students relate to local environment.
• Simple sustainability actions: e.g., bird feeder attracts birds, keeps ecosystem green.

Exam tip: Small, incremental actions (cold storage, solar rooftop, local sourcing) can be as important as large infrastructure for SME sustainability — they build a culture of resilience and demonstrate ESG compliance.

---

How to Identify Regional Opportunities for SME Decarbonisation

Push and pull dynamics

• Push from government: Special Economic Zones (SEZs), notified industrial areas, investment promotion agencies.
• Pull from locals: e.g., Mangalore’s “Come back Pili” campaign — local demand for IT industry, leading to KEONICS IT park (“Silicon Beach”).
• Push from policy: e.g., BBMP mandate for sewage treatment plants (STPs) in housing complexes → created demand for STP consultancy entrepreneurs (skilled through government-sponsored training at EMPRI).

Key questions for an entrepreneur

1. Where is the money flowing? Study the district: who is earning, from what, where are gaps?
2. Spend time with people on the ground. Listen to aspirations — industry will not succeed if locals are uninterested.
3. Make friends in the field. Access conversations and unsaid concerns beyond secondary data.
4. Read the village (or the local context) — don’t arrive with a solution looking for a problem.
5. Revisit compliance as opportunity. Sustainability regulations (STP mandate, green financing) can create new business models.

---

Key Takeaways

1. Global supply chains are the primary driver — ESG compliance is a must for export; fines can reach 40%.
2. India’s domestic policy is also pushing — industrial associations, green financing, net-zero commitments by large corporates ripple down to SMEs.
3. Local biodiversity & ecosystem services offer a unique sustainability pathway — the jackfruit cluster shows how native species can create value-added products, jobs, and resilience.
4. Small, incremental sustainability measures (solar, cold storage, waste-to-biogas, safe labour conditions) collectively meet export standards and build climate resilience.
5. Listen to the ground — spend time with communities, understand their aspirations, and identify where money flows to find genuine opportunities.
6. Early climate education (NCERT textbook) normalises sustainability thinking, making future entrepreneurs more ready to embed it in business.