Indian Company Carbon Emissions Jump 53% in FY25

Key takeaways

• The top 1,000 listed Indian companies recorded a 53% rise in carbon emissions in FY25.
• An IIM Bangalore study tracked emissions reported by major listed businesses.
• The rise shows that faster economic growth can also bring higher pollution.
• Investors will need to check both profits and climate risks more closely.

Indian company carbon emissions means the greenhouse gases released by businesses across their work. The top 1,000 listed firms saw these emissions rise 53% in FY25, according to an IIM Bangalore study. That is a sharp increase in one year. It also raises questions about India’s growth and climate goals.

Why did Indian company carbon emissions rise?

The study found a big increase across India’s largest listed companies. FY25 means the financial year that ended in March 2025. These firms cover major parts of the economy, such as power, steel, cement, transport and finance.

Carbon emissions are gases that trap heat in the air. Companies often report them as carbon dioxide equivalent, or CO2e. This measure puts different heat-trapping gases on one common scale.

The study does not mean every company increased emissions by 53%. It gives a combined picture for the 1,000 firms. Some businesses may have cut emissions, while others may have increased them sharply.

One likely reason is stronger business activity. India’s economy grew quickly, which lifted demand for electricity, roads, buildings, goods and travel. But much of that energy still comes from coal and other fossil fuels.

What does the 53% increase show?

The rise shows a gap between growth and cleaner production. More factories and power use can help companies earn more money. However, they can also create more pollution unless firms change their energy sources.

Think of it like a bus carrying more passengers. The bus can move more people, but it may burn more fuel. Companies face the same choice as they expand. They must grow while using less energy per product.

The 53% figure is especially striking because it covers only one financial year. For example, an emissions index of 100 in FY24 would reach 153 in FY25 after this increase.

Emissions index100153FY24FY25Illustrative index based on the reported 53% rise

The study’s headline number should not be confused with India’s total national emissions. It covers listed companies, not households, small firms or every public body. Still, these companies have a large economic footprint.

Which sectors may face the most pressure?

Heavy industries usually face the hardest task. Steel, cement, chemicals and power need intense heat or large amounts of electricity. Cutting emissions in these areas often costs more than changing office lights or company cars.

Transport and mining firms may also face pressure because fuel forms a large part of their operations. Banks and technology firms can report lower direct emissions. Yet they may still finance or buy services from high-emission businesses.

Business area	Main emissions risk	Possible response
Power	Coal use	Renewable power and storage
Steel and cement	High-heat production	Cleaner fuels and new plants
Transport	Petrol and diesel	Electric vehicles and better routes
Finance	Funded emissions	Greener lending checks

India’s renewable power share is growing, but demand is growing too. Our report on India’s expected 8% growth explains why energy demand may stay strong.

What does this mean for investors?

Investors may need to look beyond sales and profit. A company with high emissions could face future costs, stricter rules or pressure from global buyers.

That risk is called a transition risk. It means the cost of moving from polluting energy to cleaner energy. For example, a steel maker may need to spend billions on new equipment.

Investors should check a company’s emissions trend, clean-energy use and climate targets. They should also ask whether the company reports its data clearly. Weak reporting makes it harder to judge real progress.

Capital can also shift. Global funds may avoid firms that cannot show a credible plan. Our coverage of foreign portfolio investors returning to Indian shares shows why such flows matter.

What should companies do next?

Companies need a clear plan, not just a target year. They can start by measuring energy use at each plant and setting yearly goals.

They can then buy more renewable power, improve machines and reduce waste. Some sectors will need new technology, while others can make gains through simple repairs and better planning.

The jump in Indian company carbon emissions gives boards a warning. Growth can continue, but firms must make each rupee of output with less pollution. That will help companies face new rules and changing customer demands.

The full study and related research can be explored through the Indian Institute of Management Bangalore. India’s Ministry of Environment, Forest and Climate Change also publishes national climate policy information.

FAQs

What are Indian company carbon emissions?

They are greenhouse gases released by Indian businesses through energy use, factories, transport and other activities.

How much did emissions rise in FY25?

Emissions from the top 1,000 listed companies rose 53% in FY25, the IIM Bangalore study found.

Why do Indian company carbon emissions matter?

They matter because large firms shape energy demand, investment choices and India’s progress toward climate goals.