Here are five key measures for the private and public sector to collaborate for boosting renewable energy and wind energy in particular, for the success of Make in India.
Financial Innovation & Low cost funding
It is essential that the government creates new financing products and investment vehicles which will provide the much needed low cost funding with long tenure of 25 years for renewable energy sector. If we talk of wind power alone, for 8,000 MW a year, about Rs 40,000 crore project debt financing is required. India needs to establish rules for a Green Bond Market and facilitate inflow of low cost offshore funds such as Pension Funds into Renewables. Indian corporates are mostly leveraged either due to project delays or economic slowdown. Relaxing the sectoral and group exposure norms by RBI can be of immense help for renewable energy funding.
Government should introduce 5 per cent subsidy for using indigenous manufactured products, thereby promoting its Make in India initiative. National Clean Energy Fund and tapping of offshore funds by IREDA can also be leveraged. Alternatively, we can take learnings from Brazil financing scheme wherein local value addition is being encouraged with low cost high tenure funds. Financing innovation and low cost funding can have a revolutionary impact on the scaling up of renewables in India. Read More
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