The Union Budget of India was presented by Nirmala Sitharaman, Indian Finance Minister on February 1, 2023. The budget lists infrastructure, investment, green growth, and the financial industry as the top priorities. The green growth agenda focuses on promoting businesses that are sustainable and helping India reduce its carbon emissions. Here’s what our industry experts have to say about budget:
“Union Budget 2023 focuses on continuing the momentum towards a sustainable India. By earmarking green growth as one of the 7 key priorities, the Government has reaffirmed its commitment to decarbonization and creation of green jobs. The allocation of Rs. 35,000 Cr. for priority capital investment towards energy transition will help catalyze our Net Zero journey. Viability Gap Funding for battery storage projects, significant outlay for grid expansion for Renewable energy and the green credit programme to incentivize sustainable behavior are all very welcome and timely steps that will accelerate clean energy adoption. The PM PRANAM scheme will boost the usage of green ammonia for production of environment friendly fertilizers. The policy for scrapping old vehicles and customs duty exemption on Li-ion batteries will also help fast track EVs and clean up the mobility sector.
While all the above announcements are very good and desirable, we would also like to see some additional measures such as extending PLI scheme to manufacturing of wind turbines and electrolyzers, reducing GST on sale of renewable energy components and O&M costs, enabling low-cost project financing, deferring BCD on solar modules and cells till the domestic manufacturing ecosystem matures and establishing a stronger mechanism for monetizing carbon credits. I would also like more clarity on how the Govt. plans to achieve the target of producing 5 MMT of Green Hydrogen by 2030, especially on matters such as green hydrogen consumption mandates and its transport and storage options, among others.”
Rahul Munjal, Chairman & Managing Director, Hero Future Energies
The nucleus of Budget 2023 is enhancing the quality of life, inclusive growth and sustainability. I am sure this vision will narrate the story of ‘’New India, Progressive India”. The green economy is in the centre, and all aspects of the energy transition and security are thoroughly covered. As a result, India should surpass its current standing in the field of renewable energy, including storage and green hydrogen.
The government has taken steps to decarbonize the Indian economy, aided by specific budgets- viability funding for a 4000 MWh battery storage energy system, pumped hydro, Rs 20,700 investment for RE evacuation from Ladakh, and the inclusion of green credit in the Environment Protection Act.
Sameer Gupta, Chairman & MD, Jakson Group
The Union Budget 2023 with an outlay of Rs 35,000 crore for green energy transition, addition to the recently announced Green Hydrogen mission with outlay of Rs.19,500 crore has reiterated GOI’s commitment to achieve net zero targets alongside making India important hub for renewable manufacturing. Encouraging the Net Zero goal the government has firmly put clean energy transition at the centre of India’s economic growth. A firm step towards green missions of government will give impetus to job creation, research n development as well as export opportunities while contributing to net-zero objectives. These initiatives are likely to boost domestic manufacturing and reduce import dependence for the renewable sector. The Union Budget 2023 clearly indicates, India is ready to establish itself in the leadership position on the global green energy transition.
Bikesh Ogra, MD & CEO, Jakson Green
“Government is walking the talk when it comes to Net Zero commitment. Budget has taken bold steps in adopting new initiatives such as dedicated funds for energy transition and Green Hydrogen mission. In addition, the government has been proactive in identifying the need of storage systems to integrate the ambitious renewable energy capacity plans. Both the Viability Gap Funding for Battery energy storage systems and framework formulation for Pumped Storage Projects will pave way for accelerated adoption of renewable energy”.
Manish Chourasia, Managing Director, Tata Cleantech Capital Limited
“The Budget for 2023 has reinstituted a focus on green growth in light of the government’s heightened emphasis on increasing the proportion of renewable energy in the total energy mix. The FM has allocated Rs 35,000 crore to this sector, prioritising India’s net zero goals and energy transition. The generation, transmission, and storage of renewable energy will be supported by these funding. This gives players in this market a special opportunity to make clean energy solutions accessible and affordable, enabling mass consumerization. The inclusion viability gap funding for battery storage, renewable energy evacuation, and green credit policy coupled with domestic and foreign debt funding makes this a game-changer in the making.”
Bharat Bhut, Co-Founder & Director of Goldi Solar
“Over the years, we have seen hundreds of agri-focused start-ups bridging the information gap for the farmers but limited innovation on hardcore technologies. I hope that the newly announced Agriculture Accelerator Fund brings an explicit focus on hardware technological innovations to address challenges like pest and weed management, affordable storage, and post-harvest solutions, as well as innovations for the livestock and allied sectors.”
Abhishek Jain, Fellow & Director- Powering Livelihoods, CEEW
“The budget today has envisioned a constructive growth story for India’s future. The increased focus on infrastructure investment whether via a 33% hike in the capital investment outlay or continuation of 50-year interest free long-term bonds for the next fiscal is a conscious effort to building a strong base for future growth. Infrastructure spending whether in roadways, railways, power or traditional infrastructure sectors is likely to have a multiplier effect on India growth story. The roadmap to funding via UIDF or opening avenues such as municipal bonds are big steps towards funding infrastructure the inclusive way. We welcome the continuous and dedicated effort on futuristic India @100, especially the emphasis on promoting green power and its evacuation, development of a detailed framework for pumped storage projects or looking to deliver 24×7 power with an ambitious VGF funding for 4000 MWh worth of battery based energy storage projects. This will further promote investment in energy sector in the country, while meeting sustainable energy goals the country will need to meet around its 100th anniversary of independence. However, we hoped to see clarity on implementation of NMP and NIP as envisaged in earlier budgets. While guidelines for monetization have been notified at a broader level, monetization process is yet to pick steam. We further hoped that this budget would streamline long term capital gain taxation of business trusts in line with listed equities, since securities transaction tax (STT) is already applicable to business trusts. This would have only helped promulgate business trusts further as an investment choice, especially for retails and domestic institutional investors.”
Harsh Shah, CEO, IndiGrid
“The Union Budget 2023 has outlined a strong foundation for the Indian energy sector, with green growth emphasised as a priority for the government. The 35,000-crore allocation for energy transition, focus on promoting green hydrogen and incentivising environmentally sustainable actions through the green credit programme, will accelerate decarbonization of the power sector. The emphasis on energy storage projects, critical to scale up renewable energy capacity, complements India’s net-zero carbon emissions target of 2070. With the positive direction provided by the Union Budget 2023, IEX will continue to support the government and industry through new initiatives and technological innovations in energy market.”
S N Goel, Chairman and Managing Director, Indian Energy Exchange Limited
“The budget has laid down a promising path for the nation’s green growth, clearly identified as one of the seven pillars, with sizable outlay of Rs 35,000 crore. The finance minister has also focussed on some of the key issues like battery storage and pumped storage projects to ensure stable and round the clock supplies from renewable resources like solar and wind power. Additionally, the reduction in duties for lithium-ion batteries is a step in the right direction. It has also ushered in a key measure for the financial health of states’ distribution utilities by tying 0.5% of their deficit to power sector reforms. This is an added incentive for the states to reform the DISCOMs. However, along with incentive, a disincentive package for the discoms would have proven beneficial. Power sector also merited a bigger budgetary allocation given it is the fuel that is driving India’s growth engine. Overall, the budget has pushed all the right buttons and is well in line with the macroeconomic goals of the country.”
Pratik Agarwal, Managing Director, Sterlite Power, & Director of Serentica Renewables
The budget with a specific priority on “Green Growth” sets the tone for Sustainable India. Rs 35000 Crore worth of outlay for energy transition programs contributing to the net zero commitments of India shall further add to the overall sustainable development in the country.” Increasing investment in infrastructure by 33 percent for the third consecutive year to Rs 10 lakh crore is also showing the will power of the government to move forward. Efforts towards inclusive development and connecting youth power are promising. Proposed centralized policy for data and positivity on start up issues are also welcome steps. Entrepreneurs will also get relief from the Finance Minister’s proposals to change the income tax slab. Zero income tax on income up to 7 lakh and reduction in maximum tax rate from 42.74% to 39% seems to be an encouraging step for income tax payers of all income categories.
Dinesh Patidar, Chairman and Managing Director Shakti Pumps (India) Ltd.
“The Union Budget 2023 has taken a significant step towards green growth with its focus on green hydrogen, clean energy storage and transmission. This is a welcome move that will help India transition to a low-carbon economy and reduce its carbon footprint. We at Covestro India, are committed to supporting the Government in its efforts to promote green growth and are looking forward to working collaboratively with all stakeholders to develop innovative solutions for a sustainable future.”
Anand Srinivasan, Managing Director, Covestro
The Budget for 2023-2024, just like the budgets of the past 5-6 years, has recognised the importance of renewable energy and biofuels and has some really big announcements for the biofuels sector and renewable energy at large. Specifically for biofuels, the announcement of Rs.35000 cr outlay for Initiatives towards Net-zero, the announcement of a green credit programme to incentivise Capex investments towards climate action by companies and the announcement of support for ‘waste to wealth’ plants under the GOBARdhan scheme will give a significant boost to the biofuels and waste to Fuels sector in India. With policies like these, it’s only a matter of time before India will be a global leader in biofuels and climate action. We at Buyofuel will ensure that we continue to put all our energy and time into ensuring that India achieves its net-zero goal much earlier than 2070.
Kishan Karunakaran, Founder and CEO, Buyofuel
“The Union Budget 2023 has focused on key enablers of the economy, including India’s gas sector which is at the cusp of major transformative changes. The proposed exemption in excise duty on CNG to the extent equal to the GST paid on biogas or compressed biogas, is encouraging for the sector. We are also excited by the proposal to introduce 5 percent CBG mandate for all organizations marketing natural and biogas in due course. At IGX, we believe that this is a great initiative since CBG not only has the potential to create something out of waste but also adds to sustainability. In line with this development, we will explore opportunities around CBG trading at IGX , in consultation with the stakeholders.”
Rajesh Kumar Mediratta, MD & CEO, IGX
“The Union Budget rightly builds incentives to support low carbon development pathways with the focus on Green Growth among the Saptarishi priorities. Catalyzing sustainable growth in India will require incentives to drive investments in technology and innovation, to ensure that we do not have to make trade-offs between people and planet. We welcome the increased outlay towards energy transition, and particularly for Green Hydrogen and waste-to-energy, which will boost energy independence. The PRANAM scheme and bio-inputs centres shall incentivize adoption of sustainable and regenerative agriculture practices. The Green Credit programme will channel much needed capital to support the transition to a sustainable economy. Concessional duties on Li-ion batteries will provide further boost to the EV sector and help decarbonize the transport and logistics sectors. The measures announced in Budget 2023 will further strengthen India’s position as a global climate leader, and catalyze sustainable, inclusive development.”
Anjali Bansal, Founder, Avaana Capital
“This Budget is one of the best budgets ever, truly inclusive and addresses the aspirations of every section of society. It empowers India’s 1.4 billion people as drivers of the India story. I compliment the PM and FM for the long term vision that was laid out in the Budget speech as well as the many progressive announcements, like increased outlay for capital expenditure, incentives for the start-ups and MSMEs, green energy, a lower tax for the middle class and boost to tourism which will create massive jobs and reinforce India’s position as the fastest growing major economy in the world”
Anil Agarwal, Chairman, Vedanta Ltd.
“The FY24 Budget appears to usher a phase of ‘green transition’, guiding the economy toward a sustainable development pathway. By focusing on implementing various initiatives to increase energy efficiency and lower carbon intensity, it demonstrates a commitment to foster green growth in the nation. The proposed budget places a strong emphasis on the creation of large-scale green job opportunities to prepare young people for mitigating the effects of climate change. The National Green Hydrogen Mission’s outlay of INR 19,000 crore would also support and contribute to green growth and a net zero carbon future. The provision of INR 35,000 crore for energy transformation and net zero emissions would indeed help the nation in achieving its goal of net zero emissions by 2070. India will become a responsible and energy-secure country owing to the Honourable Prime Minister’s vision for Lifestyle for Environment (LiFE), which will accelerate the country’s transition to a low-carbon economy and lessen dependency on fossil fuels.”
Dr. Satish Kumar, President & Executive Director, Alliance for an Energy Efficient Economy (AEEE)
“The FY24 budget lays a strong foundation for sustainable development of India in the Amrit Kaal. With the goal of achieving net-zero emissions by 2070, it focuses on energy transition and decarbonization of the economy with a sizeable allocation of Rs 35,000 crore. The vision for ‘LiFE – Lifestyle for Environment’, is deeply ingrained in the budget and reaffirms the government’s commitment to tackle the climate crisis. Globally, India ranks fourth in installed renewable energy capacity and the budget will give a further fillip to the addition of capacities in areas like wind and solar. Key measures are being taken to support green growth, including viability gap funding for battery storage, renewable energy evacuation, National Green Hydrogen Mission, and green credit policy. With an investment of Rs. 10,000 crore, the budget also underlines the need for embracing a circular economy through the GOBARdhan scheme. Furthermore, setting up three centers of excellence for Artificial Intelligence is a welcome step from the government as it bridges the skill gap in the AI space and nurtures talent to develop tech of the future”.
Anil Chaudhry, Zone President, India and CEO & MD, Schneider Electric India Pvt. Ltd.
“For reaching our goal of net zero carbon emission by 2070, Green Growth has been made one of the 7 priorities of this year’s budget. The government is implementing various programs for green groth which will help reduce carbon intensity and create green jobs. The Rs. 35000 crores capital investment for achieving energy transition and net zero objective and energy security by Ministry of petroleum and natural gas will help the country’s goal of decreasing the share of fossil fuels and increase the share of renewable energy. The Finance Minister highlighted National Green Hydrogen Mission with outlay of 19000 crore to help achieve annual production target of 5 MMT by 2030 for facilitating the net-zero target. The government highlighted Green credit Program under the Environment (Protection) Act to incentivize sustainable actions which is a net positive for the renewable energy industry. Promotion of Battery energy storage systems by Viability Gap funding of capacity 4000 MWh and extending exemption on machinery for production of Li-Ion battery manufacturing will further increase India’s domestic production capacity.”
Gautam Mohanka, Managing Director, Gautam Solar
India Energy Storage Alliance (IESA) is extremely happy with FM’s budget announcement with the focus on emerging clean technologies like energy storage, green hydrogen, and electric mobility. Mr. Debi Prasad Dash, Executive Director, IESA urged the Finance ministry earlier this year to support in custom duties for manufacturing machineries and capital goods. Under India Battery Supply Chain Council (IBSCC), IESA work with 50+ potential battery giga-factory and supply chain players and expect to see 140+ GWh of Battery cell manufacturing capacity by 2030. Honourable FM Smt. N Sitharaman agreed to IESA’s request and considered the Custom duties exemption (to Nil till 31st March 2024) for capital goods and machineries for Li-Ion manufacturing in India in this budget. Mr. Dash also added that the announcement of Viability gap funding (VGF) for Battery Energy Storage Systems (BESS) project with capacity 4000 MWh will help to advance the battery projects in India and will support higher renewable adoptions for the grid. This will help SECI, NTPC and various state agencies to come up with more battery storage projects in India. IESA released India Energy Storage Vision document last year with a grid scale market potential of 160 GWh by 2030 and submitted to PMO, NITI Aayaog, MNRE, MoP and other state and central government officials and urged India to have an official energy storage target for the nation.
Debi Prasad Dash, Executive Director, India Energy Storage Alliance (IESA)