The electrification rate in India could rise from 19 per cent today to 32 per cent by 2035, with transport electrification playing a major role, the International Energy Agency (IEA) has said in its latest Electrification special report.
Meanwhile, in Southeast Asia, the electrification rate could rise from 25 per cent to 37 per cent. Electric two- and three-wheelers and cars are now cheaper on average in these countries over their usual ownership period than internal combustion engine alternatives, the report said.
It also stated that the energy import bills of fuel-importing countries around the world could fall by more than $400 billion by 2035 compared with 2025 levels if they substantially accelerate the electrification of their economies. For India, reduced imports could yield savings of nearly 30 per cent of its 2025 import bill.
Owing to the effects of the conflict in West Asia and disruptions to shipping through the Strait of Hormuz, governments and consumers, especially in fuel-importing countries, have faced concerns about supply shortages and higher energy prices, the report stated. Amid the crisis, several countries announced electrification policies. India launched a programme to procure and deploy 500,000 induction cooktops.
Moreover, sales of electric cars in India increased by over 115 per cent in the four months from March to June 2026 compared with the same period in 2025, it added. EVs accounted for over 65 per cent of three-wheeler sales in 2025.
The IEA also said that in India, where solar photovoltaic (PV) shares are growing rapidly and demand is increasingly concentrated in the evening and at night, smart charging, time-of-use tariffs and vehicle-to-grid systems can shift demand to off-peak periods and improve grid utilisation, while strengthening the economic case for EVs.
The IEA said that while China remains a major source of growth in air conditioning demand, India and Southeast Asia’s combined share of the global stock could rise from less than 10 per cent today to 20 per cent by 2035. “As incomes and temperatures rise, AC uptake is set to grow: by 2035, around half of households have cooling access, with nearly 90 per cent of new residential AC stock added in emerging market and developing economies,” it said.
Emerging market and developing economies saw increased electricity demand, the IEA said, with annual growth from 2015 to 2025 averaging around 5 per cent in both India and Southeast Asia.
It increased at an average annual rate of more than 3 per cent over the period, driven by strong growth in buildings and non-energy-intensive industry and led by China. China alone accounted for over 60 per cent of the global increase in electricity demand over 10 years.
