A GREEN ROADMAP TOWARD INDIA'S AMRIT KAAL

The Union Budget vindicates India’s commitment to reducing its carbon footprint. BW Businessworld scans the fine print for a realistic assessment of this goal

- Arjun Yadav

AS THE FIRST UNION BUDGET that comes in the wake of the historic cli-mate summit in Glasgow (COP26) in 2021, Union Finance Minister, Nirmala Sitharaman’s focus on energy transition and climate action did not come as a surprise at all. Her key announcements for the energy sector accelerates India’s energy transition, setting a roadmap not just for the year 2030, but for 2070 in the long term, when India proposes to reach its net-zero carbon emission targets.

Presenting her fourth Union Budget for FY 2022-2023, Sitharaman said that this budget would steer the Indian economy towards India @ 100. She defined the 25-year-long lead up to 2047 as the Amrit Kaal. Her top four priorities included progress toward a digital economy, focus on fintech and technology-enabled development, apart from the energy transition and climate action.

Solar energy and emphasis on strengthening the energy storage infrastructure remain the focus of the government in the renewable energy sector. The launch of sovereign green bonds will fund the transition to renewable energy and so reduce India’s carbon footprint in the long run. The states will get some fiscal room for power sector reforms to alleviate the financial health of distribution companies.

Solar PLI Scheme’s Corpus Grows

India aims for 280 GW of installed solar capacity by 2030 and needs to encourage indigenous manufacturing of components. The additional allocation of Rs 19,500 crore for the production linked incentive (PLI) scheme for manufacturing components for solar power should facilitate achieving this goal. The allocation is nearly a five-fold increase from the Rs 4,500 crore allocated earlier, bringing the total outlay of the incentives for domestic production of solar power components to Rs 24,000 crore.