India’s automobile industry could reduce its manufacturing emissions by 87 per cent by 2050 through a shift to green electricity and low-carbon steel, according to a study released by the Council on Energy, Environment and Water (CEEW).

The report estimates that if original equipment manufacturers (OEMs) and their suppliers target net-zero emissions by 2050, annual emissions could fall from a projected 64 million tonnes of CO₂ (under the business-as-usual scenario) to just 9 million tonnes. This would require OEMs to adopt 100 per cent green electricity and steel suppliers to source 56 per cent of their energy from hydrogen, while reducing coal’s share to below 10 per cent. Additionally, increasing scrap-based steel production to 48 per cent by 2050 would further cut emissions and improve resource efficiency.

While several leading Indian automakers have committed to reducing direct factory and use-phase emissions, the report notes that upstream supply chain emissions remain largely unaddressed. These upstream emissions—primarily from steel and rubber—currently account for more than 83 per cent of the sector’s total emissions.

Dr Arunabha Ghosh, CEO of CEEW, said, “India’s auto industry stands at a turning point. Automakers must decarbonise the manufacturing process, the energy powering their plants, and the supply chain that produces key inputs like steel and rubber.”

The study mapped emissions across three scopes: Scope 1 (direct emissions from manufacturing), Scope 2 (indirect emissions from electricity use), and Scope 3 (upstream supply chain). Scope 3 emissions were identified as the dominant contributor, largely due to the sector’s heavy reliance on coal-intensive materials.

Dr Vaibhav Chaturvedi, Senior Fellow at CEEW, added, “To align India’s auto sector—central to GDP, jobs, and industrial growth—with a net-zero future, we must go beyond electrifying vehicles and decarbonise manufacturing itself.”

The report advocates accelerating electric vehicle (EV) adoption while also decarbonising the broader manufacturing value chain. In assessing a high-hybrid scenario, where hybrid vehicles dominate initially, the study found that while supplier energy demand would drop by 7 per cent, emissions would remain slightly higher than under a full EV transition due to continued use of combustion engines.