Budget 2023: Finance Minister pumps for renewable energy but detailing of programmes required

This Budget has been presented at the start of the vision for ‘Amritkaal’ and as part of that, seven key themes have been highlighted, which will be the Saptrishi mantras shepherding growth in this golden age: · Inclusive development · Reaching the last mile · Infra & investment · Unleashing the potential · Green growth · Powering the youth · Financial upliftment From the above themes, if we focus on those relevant to the sector, we see a key impetus to the infrastructure and green energy perspective. At an overall level, this can be seen in the significant boost to overall capex outlay to Rs 10 lakh crores, which would account for more than 3 percent of our annual product. Within this, if we deep-dive we see that Railways has a significant chunk of Rs 2.4 lakh crores which will go to building our transport infra and strengthening multi-modal connectivity. In addition, 100 critical transport projects for ports, fertilizer, and coal among others have been indicated which will see Rs.75,000 crores of investment, plus the government support for inter-state transmission projects for 13GW RE projects – clearly there is intent to improve the delivery infrastructure for key energy and chemical products. Push towards renewable energy sector Then if we look at the green push, there is the proposed outlay of Rs 35,000 crores for achieving energy transition and net zero, and the fillip to green H2 is part of that as per the earlier announced 19,700 cr. outlay. In addition, there is fiscal support indicated for various green initiatives – VGF for 4000 MWh BESS projects; a proposed framework for pumped storage projects; customs duty exemptions for capital goods for Li battery manufacturing; structuring of green credits program under EPA; revision in customs for denatured ethyl alcohol, which is key AI in chemical industry; setting up of 10,000 bio-input resource centres for enabling bio-based ecosystem; all of which will accelerate in parts the green and bio pillars of growth. The finance minister has done a good balancing job of bringing out investments for the sector both in terms of infra and fiscal incentives, while also trying to push consumption through lower tax provisions and putting more income in hand, and optimising on other programs to balance the fiscal deficit. There is strong intention in this project, and what is of course required is the detailing of some of the programmes outlined, defining and delivering on the capex outlay in specific projects in a time-bound manner to really start realizing the ‘Amrit’ the country is looking forward to. The writer is Partner and Lead – Oil & Gas and Chemicals, KPMG in India. He tweets @KPMGIndia. Views expressed 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.