Union Budget 2024 could be crucial for Indian manufacturing sectors

As Union Finance Minister Nirmala Sitharaman gears up to present the Union Budget for 2024-25 on July 23, leaders from critical materials, energy and manufacturing sectors have outlined their expectations for significant reforms and policy support. With the Budget session beginning on July 22, these leaders are emphasising the need for strategic measures to boost India’s global competitiveness and drive sustainable growth.

Rajat Verma, Founder and CEO, LOHUM, emphasised on the need for eco-friendly measures in the critical materials sector. “We hope that the upcoming budget will establish long-term eco-friendly measures like Extended Producer Responsibility Floor Price to promote a sustainable critical materials sector in India and establish India as a global leader,” Verma said. He called for a PLI scheme for recycling secondary materials and emphasised on the need for rationalisation of GST in the scrap category and technology partnerships with established Indian players.

Pratik Agarwal, Managing Director, Sterlite Power and Chairman, Serentica Renewables, highlighted the power sector’s expectation of major reforms. “As we approach the Union Budget, the power sector is eagerly awaiting key reforms. I am hopeful of comprehensive measures to turn the tide in distribution,” Agarwal noted. He advocated for extension of full ISTS exemption for another two years and a policy of sourcing competitive components from globally. Agarwal emphasised the importance of integrating extensive energy storage solutions and exploring technologies like small modular reactors (SMRs) to diversify India’s energy mix.

Rajeev Kashyap, Vice President and Managing Director, Nextracker India, highlighted the role of the budget in reaffirming the government’s commitment to renewable energy. “We expect the new government to reaffirm its commitment to renewable energy, especially in terms of innovation, local manufacturing, technology integration and R&D in the solar sector,” Kashyap said. He called for a reduction in GST rates on solar equipment and systems to boost domestic manufacturing and increase project returns. Kashyap also stressed the need for policies to strengthen battery storage and develop skilled manpower for the renewable energy industry.

Amit Jain, CEO and Country Manager, ENGIE India, expressed his expectation for the budget support for renewable energy initiatives. “ENGIE India looks forward to the Budget 2024 as a key step towards promoting renewable energy initiatives. Our vision is based on a future where renewables provide clean, reliable and affordable energy and solar energy plays a central role in our commitment to achieve net zero carbon emissions by 2045,” Jain said. He emphasised on the need for a simplified regulatory environment to integrate renewable energy sources into the national power grid and initiatives to promote public-private partnerships to develop distributed energy infrastructure.

Sirajuddin Ali, Founder and CEO of Malitra India, emphasised the need for the development of EV charging infrastructure. “Providing subsidy for this purpose can significantly increase the expansion and availability of charging networks across the country, encouraging more consumers to adopt EVs,” Ali said. He also called for addressing the issue of reversing GST input credit for EV charger manufacturers and empowering SMEs and startups in the charging industry.

Vikram V, Vice President and Co-Head, Corporate Ratings, ICRA Limited, stressed on the need to support renewable energy, energy storage projects and strengthening of the transmission and distribution grid. “Given the healthy growth in electricity demand and the focus on renewable energy, measures to support renewable energy, energy storage projects and strengthening of the transmission and distribution grid are likely to continue in the upcoming fiscal,” said Vikram. He stressed on the importance of policy measures to promote the development of energy storage systems and incentives to promote grid-scale production of battery systems.