Page 53 - Policy Economic Report - September 2024

POLICY AND ECONOMIC REPORT
OIL & GAS MARKET

Union Minister for New and Renewable Energy Shri Pralhad Joshi posted on X " India's renewable energy
sector has contributed immensely to the #10YearsOfMakeInIndia. From PLI to VGF, we are extending all
possible support to our domestic industries. We are committed to establishing India as a major global
player in the complete value chain of clean energy solutions."

Measures taken to promote domestic renewable energy equipment manufacturing

Several measures have been taken by the Union Government to promote the domestic manufacturing of
renewable energy equipment, such as solar PV modules, cells, and upstream components like ingots,
wafers, and polysilicon. These efforts also include the manufacturing of wind turbines, electrolysers for
green hydrogen production, and battery energy storage systems for utility-scale electricity storage
applications.

The Government's efforts span financial, fiscal, and policy measures aimed at bolstering domestic
production. Financial incentives include the Production Linked Incentive (PLI) scheme for setting up fully
or partially integrated manufacturing units for solar PV modules and upstream components. Additional
support measures include Viability Gap Funding (VGF) for stationary Battery Energy Storage System
projects and incentives for manufacturing electrolysers and green hydrogen production under the
National Green Hydrogen Mission. Fiscal incentives include concessional customs duties on inputs
required for domestic manufacturing, waivers on import duties for specific capital goods needed for solar
PV cell and module production, and impositions of basic customs duties on imports of solar PV modules,
cells, and inverters.

Under Union Minister for New and Renewable Energy Shri Pralhad Joshi, policy measures have been taken
through provisions such as the Domestic Content Requirement (DCR) in schemes like PM Surya Ghar: Muft
Bijli Yojana, PM-KUSUM, and CPSU Scheme Phase-II, where Government subsidies are provided. Other
policies include linking PLI amounts to local value addition, Quality Control Orders for solar equipment,
and approved lists of models and manufacturers for solar and wind technologies.

Boost to Solar PV manufacturing

Solar PV manufacturing remains a significant focus of the Government’s efforts. The Government is
committed to making India self-reliant (Atmanirbhar) in solar PV manufacturing and establishing India as
a major player in the global value chain. This commitment is demonstrated by the Rs. 24,000 crores outlay
for the PLI Scheme for High-Efficiency Solar PV Modules and additional policy interventions, such as the
imposition of basic customs duties and domestic content requirements.

Since 2014, India's installed solar PV module manufacturing capacity has grown from 2.3 GW to
approximately 67 GW, thanks to various measures under the "Make in India" initiative. This increase
makes India capable of meeting domestic demand while also catering to exports. The country has seen
rapid growth in solar PV module production capacity, jumping from 8 GW in 2021 to 67 GW per year in
the last 3.5 years alone.

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