There has been a lot of activity in the fight against climate change between the release of the interim budget and the final budget, which is scheduled for July 23.
Blame the government’s past inaction, climate-related incidents and causalities increased manifold. The rise in these events forced the government to prioritize climate action.
However, when it comes to achieving sustainable development goals, nations are far behind schedule globally. India is also far behind the set targets for SDGs. As per the Sustainable Development Dashboard, out of the 17 SDGs, India has significant challenges remining in Climate Action and Sustainable Cities and Communities.
I believe that the “inclusive,” “Green,” interim budget will see a continuity in the full budget as well.
The current budget is anticipated to have targeted expenditures that will lead to the government’s net-zero target by 2070. Energy transition, in my opinion, will be the main focus of this budget.
Let me list the five areas that will gain more attention in the current budget.
a) Infrastructure with energy efficiency or green norms:
I anticipate that the budget will emphasize stepping up efforts to meet the objectives to strike a balance between sustainability and economic growth. This is possible only with the help of policies, conducive regulations, and supportive outlays. In the interim budget, we saw large outlays in infrastructure. However, this full budget may feature support for cutting-edge technologies that will enable the county to achieve committed sustainable growth.
b) Green hydrogen:
I expect more outlay in this segment as R&D in green hydrogen requires more funding support. Though the country is steadily making progress in green hydrogen production, cost-effective commercialization is still some way off.
c) Emission reduction and carbon capture:
I expect the finance minister to announce initiatives for emission reduction and carbon capture. It could be in the form of incentives for large polluting industries or as support for emerging technologies that will help to meet their reduction targets. The budget may surprise us with a policy framework to accelerate efficient and eco-friendly growth.
d) Renewable energy:
India has already initiated its journey to obtain 500 GW of renewable energy or 50% RE in its energy basket by 2030. But, doing so calls for stronger policy support. Remember, India’s RE potential is much higher than the projected target. Expecting more announcements on renewable energy and clean fuels, energy efficiency, RE evacuation, and sustainable practices. Given that RE is infirm, supporting the expansion of storage facilities might also be a priority. A statement about skill development in the context of green jobs may also be made.
e) Auto/EV:
e-vehicles and charging infrastructure have made significant progress in the past few years. States like Maharashtra, especially Mumbai are seeing more e-vehicle registrations than fossil fuel-powered vehicles. Nonetheless, the industry seeks policy backing to expedite extensive implementation and shifts. Incentives are needed to develop charging stations using renewable energy sources. Expectations are also high for FAME-3, incentives for localizing EV components, priority lending schemes, and lower GST on EV services. The industry also anticipates government support to prepare for technologies like fuel cells, hydrogen, and flex-fuel.
Our take:
Ms. Nirmala Sitharaman outlined a clear roadmap for “Vikasit Bharat by 2047” in the interim budget. Now, I expect her to focus on energy transition, transportation, water, and waste management. As a continuation of the women-centric approach, we may see an increased emphasis on social focus — resilient community-based solutions for sustainable growth, which is a key factor.