Pedal to the metal: accelerating green transport in Asia

The transport sector is essential to trade, economic development and our daily lives, but it is also a major source of pollution and contributor to climate change

Manishi Raychaudhuri, Head of Asia Pacific Equity Research for the Asia Pacific Region


As more people in Asia get behind the wheel or hop on a plane, the region’s contribution to climate change will continue to grow. The Asian Development Bank predicts that Asia’s share of total worldwide transport-related CO2 emissions will rise to 31% of the global total by 2030, from 19% in 2006 ⁴. The development agency also expects emissions from transportation will rocket to 80% of the world’s greenhouse gases by 2050.

Gridlocked roads, smoggy skies and a host of health conditions have plagued Asian megacities in the last 10 years. In 2015, more than 50% of the world’s deaths caused by air pollution occurred in just two Asian countries – China and India ⁵. India alone faces 1.2 million deaths per year attributed to air pollution. ⁶

As a result, governments across Asia face increased pressure to reduce emissions caused by the transportation sector. China, India, and Japan are just a sample of the region’s countries that have outlined emission mitigation policies in their plans to meet the long-term goals of the Paris Agreement – namely, to keep the increase in global average temperature to below 2°C from pre-industrial temperatures.

Decarbonising the transport sector is a core strategy for many Asian countries. Government investment in low carbon infrastructure, incentives for low-emissions vehicles, and use of renewable energies are just some of the policies driving the greening of the transport sector.

High-speed rail is a good example of this approach, as studies show that it can be up to 14 times less carbon intensive than car travel ⁷. China has led the way in high-speed rail with its network expected to double by 2020 from 2014 ⁸.

Several countries have also focused their attention on the car industry to lower fuel consumption by gradually phasing out the production of petrol and diesel cars, and incentivising new energy vehicles. China and Korea plan to build and expand charging stations so that electric vehicles have easier access to recharge. ⁹ India has also announced plans to only sell electric vehicles by 2030, while China expects that one-fifth of its cars will be powered by electricity by 2025.

In addition to reducing emissions in the auto sector, countries like China, Indonesia, Thailand and the Philippines have dedicated plans to develop the airline industry in a sustainable way. By 2020, China plans to reduce carbon intensity by 22%. Similarly, the Philippines intends to improve fuel efficiency by 25% from 2016 levels by 2030.

Although Asia’s economic rise has led to severe environmental consequences, the region also has some of the largest markets, as well as some of the strongest commitments globally to create a sustainable transportation sector.

“Government and industry led regulation is happening and will only intensify,” said Mr. Raychaudhuri. “Transportation companies will be under increased scrutiny, which should lead to technical and operational innovations that are key to mitigating emissions.”

The scale of Asia’s future transit needs is so large that doing nothing is not an option for governments and transportation companies. With buy-in from governments and innovative solutions from the private sector, greening Asia’s transport sector proves to be a long road ahead, but a lifeline for continued growth in the region.