Budget 2023-24 Expectation: Seven-point recommendation to achieve energy independence for India by 2050

Today the world is volatile and uncertain. We face a deep economic crisis, even as the ghost of COVID-19 leaves many nations reeling under its long-term impact. To emerge from these crises with a sustainable growth model, nations need a source of power. This power comes from the availability and assured supply of FOL (Fuel-Oil and Lubricants), a prime mover for industrial output. India, one of the fastest-growing economies in the world, powers this need for FOL by importing nearly 85 per cent of its crude oil requirements. In 2021-22, India’s import bill was $119 billion, up from $62.2 billion in 2020-21. As per government data, India’s power consumption rose by more than 11 per cent to 121.19 billion units in December 2022, versus consumption last year. Need to look at alternative sources of energy Right now, the cyclical cold waves holding their swell over the nation’s northern states have left them hungering for more energy. As familiar sources of domestic crude oil deplete with time, India needs to look at alternate sources to meet its energy requirements, especially in these winter months. To put this in perspective, the western world’s industrial growth in the last 400 years came at a cost to the environment. And we see its impact in markers for climate change today - melting glaciers, rising sea levels, extinction of species and the deteriorating quality of human life. That is neither sustainable growth nor a sustainable life cycle for our planet. Our road to economic growth while safeguarding our environment requires a dramatic change in perspective. We need to adopt innovative energy generation solutions at all levels. On this note, we are glad that the Indian government under the leadership of Prime Minister Narendra Modi has announced several forward-looking legislative reforms and policies to achieve energy independence for India by 2050. Indigenous green hydrogen can be a game changer Further, as agricultural sector is a substantial contributor to Indian GDP, it needs to support our farmers with affordable fertilisers. India’s annual fertiliser subsidy bill stands at a whopping Rs 2.3-2.5 lakh crore. Please note the common link between fertilisers and our above-mentioned FOL is Hydrogen. So, a critical way to reduce our import bills on FOL and fertilisers would be by creating indigenous hydrogen production, storage and transportation ecosystem at affordable rates. Indigenous Green Hydrogen production can be a game changer during India’s existing Amrut-Kaal, as this would catapult the Indian economy into the $5 trillion club. To this end, the Indian government has powered three new initiatives - a Green Hydrogen Panel for mandatory procurement of Green Hydrogen by Key Sectors, the National Fertilizer Policy and the New Industrial Policy to promote domestic industry. The trilogy of these initiatives proves their intent and resolve towards boosting a Green Hydrogen economy. What Budget can do The next step here would be to ensure the availability of technology to manufacture electrolysers to generate the hydrogen required for these measures to succeed. Currently, electrolyser technology is expensive and available only in the west; our government needs to institute measures to boost R&D and IP creation for this technology. As industry stakeholders in green hydrogen technology, the author recommends the following inclusions in the Union Budget 2023-24: 1. An institute dedicated to R&D, budget for innovation and creation of electrolyser technology in India 2. Enhanced budget overlay under the PLI scheme for Green Hydrogen 3. Tax holidays for MSMEs involved in Green Hydrogen generation and electrolyser manufacturing/assembling. 4. Custom Duty Exemption on import of raw material to manufacture electrolysers for five years from 2023-24; this would enable importing technology and help scale domestic manufacturing. 5. Exemption on Make-in-India electrolysers from GST 6. Government’s firm off-take on purchase agreements for green hydrogen and ammonia 7. A policy to enable infrastructure to store and transport green hydrogen. India as a G20 leader also faces the challenge of climate change on the international body’s agenda. If we do not act now, we would negate this agenda. We may also miss the 1.5-degree target agreed upon by the world in the 2015 Paris Climate Control Agreement. So, we need to incorporate these enabling provisions in the Union Budget 2023-24 to promote and adopt Green Hydrogen. This will ensure our desired sustainable, equitable growth and make us a world leader in this technology. The writer is a consultant and Chief Technical Officer (CTO) of Greenzo Energy India Limited. He tweets @bharatleo. Views are personal.   Read all the Latest News, Trending News,  Cricket News, Bollywood News, India News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.