Aiming to bolster India’s green transition, the fiscal 2025 budget allocates $13.9 trillion to the renewable energy and power sector, boosting solar module production.
During the annual budget presentation for 2024-25 on Tuesday, Finance Minister Nirmala Sitharaman announced a substantial increase in allocations for the renewable energy and power sectors, injecting over $13.9 trillion into these critical areas. The Ministry of New and Renewable Energy (MNRE) and the Ministry of Power (MoP) received $520 billion and $870 billion, respectively. Thus, signalling the government’s intent to strengthen the energy infrastructure amid rising environmental and economic demands. Notably, the budget has seen a significant 25 per cent increase in funding for critical schemes under the MNRE from the interim budget, a proactive step that bodes well for the future of renewable energy in India.
As part of the fiscal 2025 budget, the government has earmarked $252 USD crore for various power projects. This includes financial support for an 800 MW commercial coal power plant that will utilize Advanced Ultra SuperCritical (AUSC) technology. This innovative technology is expected to significantly enhance the efficiency of the coal fleet, demonstrating the government’s commitment to investing in sustainable and efficient solutions.
The government also announced the removal of the 5 per cent basic customs duty on critical minerals like lithium and cobalt. This strategic cut is poised to reduce the production costs for battery energy storage systems (BESS), which complements the $960 million viability gap funding (VGF) for BESS. This funding is expected to aid the addition of 1 GW to India’s battery storage capacity, aiming for a substantial increase to 27-29 GW by 2030.
