Researchers from the Indian Institute of Technology Madras have suggested environmental regulations to increase energy efficiency in the country’s manufacturing sector.
Researchers from the institute collaborated with their international counterparts and studied the manufacturing sector using the data for 15 years from the year 2000 to 2015. The data projected a need for green domestic policy mapped with foreign direct investment (FDI) and trade to improve productivity and energy efficiency.
The study urged adoption of new technology; one-to-one correspondence and linkages between tax and energy intensity to promote renewable energy; and tax credit or exemption for firms improving energy efficiency. The researchers said export participation and foreign direct investments could help the country’s economy as well as increase energy efficiency in the manufacturing sector.
Santhosh Kumar Sahu, assistant professor in Economics, in the Humanities and Social Sciences department, led the research. Ajay Kumar from Emlyon Business School, France and Kim Hua Tan from Nottingham University Business School , United Kingdom, were the foreign collaborators.
The research findings were published in the peer-reviewed journal Annals of Operations Research.
Mr. Sahu said the aim was to find out if it was right to levy more taxes on firms to reduce greenhouse emissions. Their study concluded that the data of the 15 years they used for the study indicated improvement in energy efficiency in the manufacturing sector, indicating that advanced technology had been adopted at the firm level.
