How has ‘Make in India’ been a boost to the Renewable Energy Sector?

India is expected to be the most populated country in the world by 2025 and the third largest economic
power by 2030. The growth will lead to huge demand for energy and resources puting enormous
pressure on the supply side to deliver. India’s energy security has become a key driving force of its
economic policy. With substantial expansion required in energy infrastructure, India has the opportunity
to create a clean energy industry to increase installed capacities while reducing the deleterious impact
on human health, environment and the climate – thus the launch of the ‘Make in India’ program.

This initiative was launched a year ago by the Honorable Prime Minister Mr. Narendra Modi, with the
intention to create jobs and enhance skills in 25 sectors of the economy, giving boost to the lagging
manufacturing sector. The program’s intent was to make the country a more competitive investment
destination. One of the identified sectors was Renewable Energy for reduction of reliance on
conventional fuels, in particular, coal. The program further aims at enhancing the energy need of the
country by aiming to address the problem of rising demand in the consumption of domestic crude oil,
natural gas and coal which has led to a strong reliance on import of these products.

Since the change in policy and focus on the Renewable Energy sector, there have emerged huge
investment opportunities. Increased ease of setting up of has made it an attractive proposition for
Domestic and Global manufacturing companies to set up base in India, capitalize on its low-cost labor,
favorable policies and tax incentives, thus making the country a hub for export of Renewable Energy
equipment. Also, to provide investors with fair returns, the Government is considering graded tariffs.

As India’s Renewable Energy sector marches from the margins to the mainstream, numerous
opportunities are becoming available to work in collaboration with global counterparts. International
cooperation in Renewable Energy research is essential to expedite the identification and development
of solutions to meet ever-augmenting demand for affordable, non-polluting and renewable energy. To
develop these cost-effective technological innovations, the need for active collaboration between
industries and academic institutes, as well as research partnerships between developed and developing
countries cannot be over-emphasized.

The ‘Make in India’ campaign has generated lot of interest among companies in building the
components required for solar energy. Manufacturing solar components has different problems, one of
them being the absence of the entire manufacturing chain present currently in India. Few enterprises
that do manufacture within the country are quite dependent on the import of components. Differential
pricing by foreign suppliers has also added to the problems for Indian manufacturers. Therefore, the
campaign is encouraging more and more backward integration to expand the chain of production in
India.

The Government has also started to procure solar energy components from domestic manufacturers.
They are hoping that through a variety of such measures they can get them visibility through which
Indian manufacturers will get a good boost. The biggest beneficiary of the ‘Make in India’ campaign has
been the solar industry for which the Government has projected the sector to attract US $100 billion
investment over the next seven years. The Government has designed an attractive incentive package to
help achieve this target with foreign companies of varying sizes. A number of major corporations have
announced investments in the past year including Foxconn, SoftBank, Bharati Enterprises, Adani Power,
Reliance Power and SunEdison.
The ‘Make in India’ campaign has also led to the exchange of best practices and technological expertise
of countries like Germany to come to India. By driving a conducive policy framework and private sector
investments, India’s installed renewable energy capacity has doubled from around 17 GW in December
2010 to over 34 GW today, accounting for 13 per cent of the fuel mix. At present, with over 22 GW, wind
power accounts for nearly 65 per cent of the total renewable capacity in the country, followed by small
hydro power (4 GW, 11 per cent of the capacity).

All these developments are slowly but surely coming together to put the Indian Renewable Energy
sector on a strong growth trajectory by not merely tweaking existing systems, but changing the
paradigm altogether. The time has come for transitioning to an energy future that has a significant
component of renewable energy. The political support being extended to this sector is unprecedented.
It is now that synergies that have been identified between the various ongoing initiatives offer the
opportunity to support the scaling up of renewable energy, with access to high-quality and relevant
training programs, as well as support to the domestic solar and wind manufacturing market, both of
which will play an important role in determining the pace of the renewable energy scale-up in India.

Thanks to the ‘Make in India’ campaign launched by the Prime Minister’s government, India has the
potential to become a manufacturing powerhouse in the region. However, the path to realizing these
ambitious plans is likely to be long, windy and not without obstacles. Yet the target of 100GW of solar
power capacity by 2022 does seem achievable and could enable significant growth in India’s solar PV
sector. Developing a robust ecosystem is the need of the hour and by right policing, incentives and
support to the manufacturing, India can most definitely achieve self-sufficiency in the energy sector.

In conclusion, the ‘Make in India’ initiative has given a huge boost to the Renewable Energy sector and
now it is up to our industry to achieve this goal and make India proud.