ABSTRACT
As India moves towards sustainable energy use in response to global warming and related climate change, we recognise the centrality of technology, technological change, and industrial policy in that process. There are two aspects of technological change which inform our understanding of the role of industrial policy. First, there is technology transfer enabling firms to access state-of-art technology which minimises emissions of greenhouse gases. Second, there is a technological change in the Schumpeterian sense, where, in response to the challenge of global warming, there is a shift in the technological paradigm, yielding new products and processes currently only on the drawing board and/or not yet commercialised. Thereby technological change would necessitate a new way of managing the economy. Industrial policy, therefore, has different and important roles to play as firms and economies navigate these changes. As India switches to a sustainable energy use path, we explore the role of industrial policy in achieving that goal incorporating both these aspects and situating it specifically in the institutional context within which it (industrial policy) operates and is implemented. The discussion takes place in the context of extensive use of industrial policy by advanced economies after the 2008 global financial crisis as well a positive reassessment within academic circles of the efficacy of the use of industrial policy in achieving policy objectives.
