Driving India’s RE Future: Pre-Budget Insights And Expectations – Sterling and Wilson Renewable Energy

The renewable energy sector in India stands at a pivotal juncture, poised for substantial growth and transformation. As we approach the Union Government’s upcoming budget, leaders in the industry are voicing their expectations and recommendations to propel this momentum further.

Mr. Amit Jain, Global CEO of Sterling and Wilson Renewable Energy, underscores the sector’s evolution driven by strategic government initiatives and innovative financial instruments. He emphasizes the pivotal role of Production Linked Incentive (PLI) schemes in fostering domestic manufacturing, potentially generating numerous jobs and driving technological innovation.

Mr. Jain advocates for revising GST rates on renewable energy components from 18% to 5%, a move that could significantly enhance the affordability and attractiveness of green energy investments across the country. Highlighting the government’s ambitious plan to invest over $360 billion in renewable energy infrastructure by 2030, Mr. Jain underscores its commitment to expanding the renewable energy mix and bolstering grid capabilities. Lower interest rates and the emergence of green bonds, with India issuing over $21 billion in such bonds by early 2023, are identified as critical enablers for financing sustainable projects and aligning investor interests with global environmental imperatives.

Mr. Chandra Kishore Thakur, CEO – Asia, Africa, LATAM & Europe at Sterling and Wilson Renewable Energy, echoes the sector’s high expectations from the budget, particularly in supporting the solar power segment. He stresses the need for streamlined approval processes and a single-window clearance system to simplify land acquisition for large-scale solar parks and ultra-mega solar power projects. Access to low-cost finance is identified as pivotal, with a call for enhanced low-interest loans and financing schemes to bolster developers and contractors in the solar power domain. Grid integration assumes critical importance, with Mr. Thakur advocating for expanded substations and transmission line capacities to support the ambitious target of adding 500 GW of renewable power capacity by 2030 and ensuring grid stability through effective energy storage solutions. Tax rationalization, including reduced GST on solar components and Basic Customs Duty (BCD) on PV modules and cells, is deemed essential to ensure a consistent supply chain until domestic production meets demand. Public-private partnerships are proposed as a means to leverage combined resources and expertise for accelerating solar project development.

Both leaders emphasized the need to enhance manufacturing capacity for key equipment such as transformers, inverters, and HT panels to bridge supply gaps and support the Make in India initiative. They advocate for capital subsidies, tax incentives, and extended deadlines for the PLI scheme to stimulate local manufacturing. These measures, they believe, will not only drive economic growth but also bolster India’s position as a global leader in sustainable energy solutions.

As India charts its course towards a resilient and green future, the budgetary decisions in support of renewable energy are poised to shape the trajectory of this dynamic sector. With strategic interventions in policy, finance, and infrastructure, the government has the opportunity to catalyze substantial investments, innovation, and job creation, paving the way for a sustainable energy landscape that meets both national imperatives and global environmental goals.