Where do these data come from?
The data on this website was produced by the Global Subsidies Initiative of the International Institute for Sustainable Development (IISD) and the Council on Energy, Environment and Water (CEEW) in support of the 2020 report Mapping India’s Energy Subsidies 2020: Fossil fuels, renewables and electric vehicles. It builds on a 2017 subsidies database that was established by IISD, ICF India and the Overseas Development Institute (ODI).
Where possible, our subsidy estimates are drawn from official government sources, such as documentation pertaining to the process of budget drafting and execution, performance monitoring, reports of state-owned companies, annual reports and tariff orders of electricity DISCOMs. In cases where it was not possible to identify an existing official government estimate, various approaches have been used to quantify subsidies independently, following standard international methods. A summary of these methods is provided in the main report. All reported subsidy values are nominal and calculated for the Indian fiscal year, where FY 2019 refers to the year beginning in April 2018 and ending in March 2019. USD values are converted from INR values using Reserve Bank of India notified rates for each year.
What are subsidies anyway? And why do they matter?
There are debates about the difference between “subsidy” and the broader term “support”—but a pretty good plain English definition is “a financial benefit that the government gives, often to a specific business, group or industry”. It’s also roughly how the World Trade Organization (WTO) defines the term. We use the WTO definition to identify subsidies for this database because it is the most widely adopted definition of subsidy, agreed by all 164 WTO members, including India.
Subsidies matter because they are used by governments around the world to influence energy producers and consumers. For producers, subsidies alter the relative competitiveness of different energy technologies and send a signal about national priorities to influence investment decisions and shape the energy mix. For consumers, subsidies can make different energy types more or less affordable to influence consumption decisions and target social outcomes. We need transparency on what subsidies exist and how much they cost in order to know whether public resources are aligned with ambitions for a clean energy transition.
Indeed, 193 countries have committed to fossil fuel subsidy reform as part of Sustainable Development Goal (SDG) 12 on responsible consumption and production. SDG indicator 12.c.1 asks countries to track progress against, “Amount of fossil fuel subsidies per unit of GDP (production and consumption)”. All countries are recommended to report on fossil fuel subsidies as part of their efforts under the UN Agenda 2030.
What types of subsidies exist?
Energy subsidies are often distinguished by whether they mainly benefit energy producers or energy consumers.
The WTO also recognizes four main types of subsidy mechanism,
- Transfers of funds and liabilities: Such as grants, credit support or paying for health, accident and environmental costs.
- Revenue foregone: Such as tax breaks or lower taxes than equivalent goods
- Below-value goods or services: Such as below-market access to government-owned energy resources, land and infrastructure
- Income of price support: Such regulations that create transfers of financial benefits between market actors, such as fixed prices for motor fuels, feed-in tariffs or biofuel blending mandates.
Can this database be used to support reporting under SDG Indicator 12.c.1?
After this project’s framework for data collection was finalized, the United Nations Environment Program published its recommended methodology for countries to report on their fossil fuel subsidies to track progress against Sustainable Development Goal (SDG) 12.c.1. This methodology is also based on the WTO definition but it categorizes subsidies into slightly different groups, taking into account ease of reporting. Policy-makers and researchers who are interested in tracking India’s progress against SDG 12.c.1 can find sufficient information in the underlying datasheets to adapt this database to this newly adopted methodology.
Where can I find more information?
Our detailed report, Mapping India’s Energy Subsidies 2020: Fossil fuels, renewables and EVs, provides an analysis of these data and their implications for India’s energy sector ambitions.
For analysis of some of our subsidy policy data in India, see:
- How to Target Electricity and LPG Subsidies in India: Step 1. Identifying Policy Options
- Gender and Fossil Fuel Subsidy Reform in India
- The Cost of Meeting Air Pollution Standards in the Coal-fired Electricity Sector
- Subsidies for Gasoline, Diesel and Electric Vehicles
- Stranded Coal Power Assets, Workers and Energy Subsidies
- The Impact of the Goods and Services Tax on Solar Photovoltaic and Coal Power Costs