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					</table>The Union Budget 2025 has received strong industry support for its emphasis on clean energy, domestic manufacturing, and infrastructure development. The budget, presented to Parliament by Finance Minister Nirmala Sitharaman last week, has <a href="https://www.mercomindia.com/budget-2025-clean-energy-manufacturing" target="_blank" rel="noopener">introduced</a> several initiatives under the National Manufacturing Mission focused on strengthening India’s role in the global renewable energy supply chain.
Industry leaders have welcomed these measures, highlighting their potential to drive investments, job creation, and energy security.
Renewable Energy Expansion 
The budget’s focus on expanding India’s clean energy capacity and infrastructure development has been widely appreciated.
Vignesh Nandakumar, CEO Asia, <a href="https://enfinity.global/" target="_blank" rel="noopener">Enfinity Global</a>, commended the government’s commitment to domestic manufacturing of solar cells, modules, wind turbines, and grid-scale batteries, stating that these efforts will accelerate India’s progress toward its 500 GW renewable energy target. He also highlighted the importance of grid strengthening for seamless renewable energy integration.
Rajiv Ranjan Mishra, Managing Director, <a href="https://www.apraava.com/" target="_blank" rel="noopener">Apraava</a>, highlighted the boost to intra-state transmission capacity and electricity distribution reforms as crucial steps toward a more sustainable power sector. He emphasized that additional borrowing allowances for states will expedite energy sector modernization.
Naresh Mansukhani, CEO of <a href="https://www.junipergreenenergy.com/" target="_blank" rel="noopener">Juniper Green Energy</a>, emphasized that the allocation of ₹15 billion (~$172.10 million) to solar power projects (grid), combined with state incentives, will strengthen clean energy infrastructure in India. He also noted the increasing solar budget allocations as evidence of India’s long-term vision for renewable energy.
Sameer Gupta, Chairman of Jakson Group, noted that the budget’s ₹10 trillion (~$114.73 billion) commitment to new projects under the Asset Monetization Plan 2025-30 and ₹1.5 trillion (~$17.21 billion) for state capital expenditure would enhance India’s energy and infrastructure capabilities. He further stressed the role of infrastructure development in driving economic growth.
Strengthening Domestic Manufacturing 
The National Manufacturing Mission, focused on clean technology manufacturing, has received enthusiastic support from industry leaders.
N.P. Ramesh, COO and Co-Founder, <a href="https://www.orbenergy.com/" target="_blank" rel="noopener">Orb Energy</a>, praised the initiative for accelerating the domestic production of solar cells, EV storage batteries, and other renewable technologies, reinforcing India’s global supply chain position. He also pointed out that Industry 4.0 will create exciting opportunities for youth in cleantech innovation.
Simarpreet Singh, CEO, <a href="https://hartek.com/" target="_blank" rel="noopener">Hartek Group</a>, underscored the significance of indigenous production of high-voltage transmission equipment and deep-tech funding in positioning India as a leader in clean energy solutions. He stated that investments in deep-tech innovation would drive breakthroughs in solar and energy storage.
Pratik Agarwal, Managing Director, <a href="https://www.sterlitepower.com/" target="_blank" rel="noopener">Sterlite Power</a>, highlighted the focus on manufacturing high-voltage transmission equipment as a strategic move to bridge the global deficit and establish India as a leader in this segment. He emphasized that transmission and distribution remain the weakest links in India’s power sector.
Anmol Singh Jaggi, Chief Managing Director, <a href="https://www.gensol.in/" target="_blank" rel="noopener">Gensol Engineering</a>, stated that the mission provides the necessary policy certainty and execution framework for India’s long-term sustainability goals. He noted that cleantech manufacturing thrives on strategic government support.
Abani Jha, CFO, <a href="https://saatvikgroup.com/" target="_blank" rel="noopener">Saatvik Green Energy</a>, welcomed the support for domestic manufacturing of solar cells and modules, noting that reducing import dependency aligns with India’s self-reliance vision. He also emphasized that indigenous solar technology will be instrumental in India’s energy transition.
Amit Paithankar, Whole-Time Director and CEO, <a href="https://waaree.com/" target="_blank" rel="noopener">Waaree Energies</a> hailed the announcement of the National Manufacturing Mission, along with enhanced PLI programs and tariff rationalization for critical minerals, will support the rapid growth of the entire renewable energy ecosystem.
Battery Storage and Grid Integration
Recognizing the pivotal role of energy storage in renewable adoption, the budget includes measures to strengthen battery manufacturing and grid integration.
Nishant Sood, Managing Director, <a href="https://www.candi.solar/" target="_blank" rel="noopener">Candi Solar</a>, called for additional duty-based support to further scale battery storage, essential for maximizing solar energy adoption. He stressed that storage solutions must expand alongside solar deployment.
Vignesh lauded the reduction of basic customs duty (BCD) on lithium-ion batteries, stating that it will facilitate the deployment of energy storage solutions alongside renewables. He also noted that storage and renewables must progress together for a seamless energy transition.
Naresh emphasized the necessity of a resilient power infrastructure, particularly for regions like Rajasthan, Gujarat, and Uttar Pradesh, where solar energy adoption is rapidly growing. He pointed out that improved transmission networks will ensure reliability and efficiency.
Paithankar noted that the inclusion of lithium-ion battery manufacturing incentives and duty exemptions on key raw materials like cobalt and lithium will accelerate India’s emergence as a global hub for energy storage solutions, furthering the EV and solar industries.
DISCOM Reforms 
The budget prioritizes electricity distribution and financial stability of distribution companies (DISCOMs), ensuring efficient power delivery and grid modernization.
Mishra noted that incentives for States to improve distribution and transmission capacity will enhance the operational efficiency and financial health of power distribution companies. He also highlighted that the regulatory reforms would make the power sector more investment-friendly.
Girish Tanti, Vice Chairman, <a href="https://www.suzlon.com/" target="_blank" rel="noopener">Suzlon</a>, highlighted the necessity of an integrated energy ecosystem, combining wind, solar, batteries, and distribution reforms for a cost-effective clean energy transition. He stressed that national security depends on building local expertise in these industries.

Budget Reactions: Industry Applauds National Manufacturing Mission for Clean Energy

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					</table>Finance Minister Nirmala Sitharaman reaffirmed the government&#8217;s commitment to strengthening domestic value addition and enhancing India&#8217;s manufacturing ecosystem for solar cells and modules, electric vehicles (EVs), lithium-ion batteries, and high-voltage transmission equipment.
Presenting the Union Budget 2025, she noted that the power sector is among the six focus domains for India’s growth potential and global competitiveness during the next five years.
The Budget saw revisions in estimates for various energy programs. The allocation for the total solar sector has gone up from ₹150.61 billion (~$1.73 billion) to ₹242.24 billion (~$2.79 billion). The National Green Hydrogen Mission’s funding was raised from ₹3 billion (~$34.6 million) to ₹6 billion (~$69.24 million).
The expenditure for the Green Energy Corridor, however, remained unchanged at ₹6 billion (~$69.24 million). On the other hand, the outlay for wind power and other renewable energy projects has been reduced from ₹8.46 billion (~497.64 million) to ₹5.51  billion (~$63.59 million).
Duty Cuts on Solar Cells and Modules
The Budget introduced revisions to customs duties on solar cells and modules. The duty on solar cells has been revised from 25% to 20%, and the duty on solar modules from 40% to 20%.
For solar cells, the earlier duty structure was 25% basic customs duty (BCD) + 2.5% Social Welfare Surcharge (SWS), bringing the effective duty to 27.5%. Under the new structure, BCD is reduced to 20%, but a 7.5% Agriculture Infrastructure and Development Cess (AIDC) has been introduced.
For solar modules, the earlier structure included 40% BCD + 4% SWS, making the effective duty 44%. The revised structure lowers BCD to 20% but introduces a 20% AIDC.
Sitharaman said the government will set up a National Manufacturing Mission covering small, medium and large industries for furthering “Make in India” by providing policy support, execution roadmaps, governance and monitoring framework for central ministries and states.
“Given our commitment to climate-friendly development, the Mission will also support Clean Tech manufacturing. This will aim to improve domestic value addition and build our ecosystem for solar PV cells, EV batteries, motors and controllers, electrolyzers, wind turbines, very high voltage transmission equipment and grid-scale batteries
In a significant move to boost the availability of critical minerals essential for India&#8217;s clean energy transition, the Finance Minister eliminated customs duties on waste and scrap of several critical minerals, including antimony, beryllium, bismuth, cobalt, cadmium, molybdenum, rhenium, tantalum, tin, tungsten, zirconium, and copper. Previously subject to varying duty rates of 10%, 5%, and 2.5%, these minerals will now be exempt from import duties.
Waste and scrap of lithium-ion batteries, cobalt powder, lead, and zinc, which were previously subject to a 5% duty, have also been fully exempted.
This follows Sitharaman’s July 2024 Budget announcement to <a href="https://www.mercomindia.com/india-2024-budget" target="_blank" rel="noopener">exempt</a> basic customs duty on 25 critical minerals unavailable domestically and to reduce duties on two others, aimed at encouraging their processing, particularly by micro, small, and medium enterprises. These measures would secure raw material availability for domestic manufacturing and create employment opportunities for Indian youth.
The minister also noted that a policy for recovery of critical minerals from mine tailings will be announced.
<a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/02/Budget-2025.png"><img loading="lazy" decoding="async" class="aligncenter wp-image-76019 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/02/Budget-2025.png" alt="Budget 2025" width="1018" height="806" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/02/Budget-2025.png 1018w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/02/Budget-2025-300x238.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/02/Budget-2025-768x608.png 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/02/Budget-2025-650x515.png 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/02/Budget-2025-624x494.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/02/Budget-2025-600x475.png 600w" sizes="(max-width: 1018px) 100vw, 1018px" /></a>
Power Sector Reforms
The government has introduced incentives for electricity distribution reforms to improve the financial health and operational efficiency of distribution companies. Additionally, it will facilitate the augmentation of intra-state transmission capacity. Additional borrowing of 0.5% of the gross state domestic product will be allowed to encourage states to undertake reforms, provided they implement the prescribed changes.
EV Push
Further expanding the government&#8217;s push for EV adoption, the Finance Minister proposed adding 35 new capital goods to the list of exempted items for lithium-ion battery manufacturing. This move is expected to significantly bolster the domestic production of EV batteries, reducing dependence on imports and fostering self-reliance in the sector.
Regulatory Reforms
Sitharaman also announced that a high-level Committee for Regulatory Reforms will be established to review all non-financial sector regulations, certifications, licenses, and permissions. The committee is expected to make recommendations within a year.
The review&#8217;s objective is to strengthen trust-based economic governance and take transformational measures to enhance ‘ease of doing business’, especially in matters of inspections and compliance. States will be encouraged to join in this endeavor.
Sitharaman highlighted the importance of developing at least 100 GW of nuclear energy by 2047 to support the country&#8217;s energy transition in a significant step towards enhancing India&#8217;s nuclear energy capabilities. To achieve this goal, the government will amend the Atomic Energy Act and the Civil Liability for Nuclear Damage Act to encourage active participation from the private sector.
A new Nuclear Energy Mission will be established, focusing on research and development of small modular reactors, with an allocation of ₹200 billion (~$2.30 billion). This mission aims to operationalize at least five indigenously developed small modular reactors by 2033, marking a major milestone in India&#8217;s nuclear energy future.
Subscribe to Mercom&#8217;s real-time <a href="https://mercomindia.com/product/mercoms-renewable-energy-regulatory-updates/" target="_blank" rel="noopener">Regulatory Updates</a> to ensure you don&#8217;t miss any critical updates from the renewable industry.

Budget 2025 Focuses on Clean Energy Manufacturing, Halves Solar Module Duty to 20%

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					</table>As India&#8217;s renewable energy sector continues to grow, the spotlight is on Finance Minister Nirmala Sitharaman as she prepares to present the Union Budget 2025. As India strives to achieve its ambitious target of 500 GW renewable energy capacity by 2030 and net-zero emissions by 2070, the upcoming budget is expected to play a pivotal role in shaping the country&#8217;s clean energy future.
Stakeholders across the renewable energy ecosystem, from solar manufacturers to energy storage solution providers, have a comprehensive wish list. They expect policy reforms, tax rationalization, financial incentives, and infrastructure development to ensure sustained growth, innovation, and global competitiveness in this critical sector.
Easier norms for debt-raising, emphasis on domestic solar manufacturing, incentives for battery energy storage systems, augmenting grid infrastructure, and making available subsidized land for setting up projects are among the areas the industry would like the budget to address.
Financial Incentives and Policy Support
Amit Jain, CEO and Country Manager of <a href="https://engieindia.com/" target="_blank" rel="noopener">ENGIE India</a> anticipates the introduction of long-term tax incentives. He also highlights the need for expedited land acquisition processes and streamlined approval mechanisms to support large-scale renewable energy projects.
Simarpreet Singh, Executive Director and CEO of <a href="https://hartek.com/" target="_blank" rel="noopener">Hartek Group</a> noted the budget must prioritize financial incentives for large-scale renewable energy projects and strengthen the focus on domestic solar manufacturing including continued support for production-linked incentive (PLI) programs and infrastructure development.
Akshay Hiranandani, CEO of <a href="https://www.serenticaglobal.com/" target="_blank" rel="noopener">Serentica Renewables</a>, urged the government to support the sector by absorbing part of the incremental costs associated with building transmission infrastructure for renewable energy expansion. Additionally, he requested the government to provide concessional financing for projects, particularly hybrid power solutions integrating wind, solar, and storage.
Shyam Sharma, Chief Financial Officer of <a href="https://www.o2power.in/" target="_blank" rel="noopener">O2 Power</a>, noted that extending the concessional 15% tax rate under Section 115BAB for manufacturing by five years would be a significant boost. “Addressing long-term financing challenges is equally critical—reinstating lower withholding tax rates on external commercial borrowings and Indian rupee-denominated bonds could ease debt-raising for renewable projects. Goods and services tax (GST) exemptions for corporate guarantees to secure special purpose vehicle loans and classifying renewable energy certificates and carbon credits as GST-exempt securities would provide much-needed relief,” he added.
Sundeep Gupta, Vice Chairman and Managing Director of <a href="https://www.jakson.com/" target="_blank" rel="noopener">Jakson Group</a>, said simplifying tax regulations and establishing a single-window clearance system for foreign investments will enhance the ease of doing business and attract global capital.
Chetan Shah, Chairman and Managing Director of <a href="https://solex.in/" target="_blank" rel="noopener">Solex Energy</a>, said captive solar power parks should be incentivized to address the growing demand. Central and state governments can support these projects with subsidies and interest benefits, creating a sustainable infrastructure that aligns with India&#8217;s green energy transition.
Strengthening Domestic Manufacturing
Alok Garodia, Managing Director at <a href="https://jil-jupiter.com/company/#team-section" target="_blank" rel="noopener">Jupiter International</a>, said India&#8217;s renewable energy products, especially high-efficiency solar technology, offer significant export opportunities. To capitalize on these opportunities, the budget must prioritize strengthening the entire value chain, from manufacturing to research and development (R&amp;D). He emphasized on domestic production of high-efficiency photovoltaic cells and modules.
Shah said a sector-specific PLI program should be introduced to aid domestic solar module manufacturers scale their operations. Establishing advanced R&amp;D laboratories with government funding and active participation from private players will enhance innovation and accelerate technological advancements in the solar sector.
He also noted that developing a comprehensive domestic ecosystem for manufacturing machinery essential for solar modules and cells will reduce import dependency, enhance cost efficiency, and bolster local innovation.
&#8220;Governments should facilitate the subsidized availability of land for setting up modules and cell manufacturing units. This will lower manufacturers&#8217; capital expenditures and attract investments in the sector,&#8221; Shah noted.
Amit Paithankar, Whole Time Director and Chief Executive Officer of <a href="https://waaree.com/" target="_blank" rel="noopener">Waaree Energies</a> noted that expanding ALMM to include supply chain components such as ingots and wafers would enable comprehensive backward integration, bolstering domestic manufacturing. Additionally, targeted tax benefits and capital incentives can encourage innovation and self-reliance.
Infrastructure and Grid Modernization
Anmol Jaggi, Chairman and Managing Director of <a href="https://www.gensol.in/" target="_blank" rel="noopener">Gensol Engineering</a>, noted that the Approved List of Models and Manufacturers framework designed for solar cells, is expected to take effect on June 1, 2026. However, with limited in-house cell manufacturing capacity and an ambitious annual target of approximately 35 GW, the demand-supply gap could lead to higher pricing for domestic cells and an increase in overall project costs.
Gupta noted that to achieve the 500 GW non-fossil fuel-based energy goal, significant investments in grid expansion, hybrid power projects, and financial mechanisms like green bonds are essential. Establishing dedicated green hydrogen corridors and fostering global partnerships is equally important.
Raman Bhatia, Founder and Managing Director of <a href="https://www.servotech.in/" target="_blank" rel="noopener">Servotech Renewable Power System</a>, said that investments in robust transmission infrastructure and the integration of solar with green hydrogen production is vital. Special allocations for solar-powered agricultural pumps and rural microgrids will bring clean energy to underserved communities.
Hiranandani requested the government to consider providing concessional financing for projects, particularly hybrid power solutions integrating wind, solar, and storage.
Promoting Innovation and Sustainability
Paithankar noted that the renewable energy sector requires robust long-term innovation capabilities built on a strong R&amp;D foundation to remain globally competitive. Increasing export subsidies for the renewable energy sector from 1% to 5% would significantly enhance India&#8217;s global standing while providing accelerated depreciation rates for core renewable assets, allowing the industry to adapt to the rapid pace of technological advancements.
Shah said building government-funded R&amp;D laboratories in collaboration with private players can reduce testing costs, streamline certification processes, and support the development of high-efficiency solar modules.
Bhatia noted that enhanced incentives for battery energy storage systems will enhance grid stability and ensure reliable power supply, particularly for off-grid communities.

Financial Incentives, Policy Support Top Solar Industry’s 2025 Budget Wishlist

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