With India’s ambitious 2030 clean energy targets and the 2070 net-zero goal, more was expected from the Union Budget 2023-24 to increase the uptake of electric vehicles (EVs) and solar photovoltaics (PVs). Currently, the EV market is struggling because of low penetration rates, and solar PVs have high production costs. Integrating EVs and solar PV systems could be a viable option for electric mobility in India, but without concessional financing available, the cost of solar projects would be too high, resulting in increased EV charging costs for consumers.
Solar energy has the potential to lead us to a net-zero future, but the demand for locally produced modules and cells is higher than the supply. The government introduced a 40 per cent customs tax on imported solar modules in April 2022 for boosting local manufacturing; however, this has resulted in delays and increased costs for the solar industry. Budget 2023-24 has not reduced this tax despite requests from the industry. Consequently, the production cost will remain high, leading to higher project costs and electricity tariffs.
Overall, the first budget of Amrit Kaal has taken some positive steps to create an enabling ecosystem for supporting new ventures and boosting the economy. If subsequent budgets bridge the gaps in addressing India’s climate commitments, it will help transform India@100 into a greener economy.
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