New and Renewable Energy Minister Piyush Goyal is a satisfied man, with most of his demands for the clean energy sector being met in the Budget.
Not only has Finance Minister Arun Jaitley removed the inverted duty structure on the solar energy equipment manufacturing sector, but the outlay for the Ministry of New and Renewable Energy has seen another increase.
In addition, coal cess has also been doubled to ₹200 a tonne which will add to the National Clean Energy Fund.
“It is very heartening to see that the Finance Minister has corrected the inverted duty structure in solar energy sector. The coal cess which has been doubled will provide a huge amount of seed capital to enable us to meet our target of setting up 175 GW of renewable energy,” said Goyal.
Prior to the Budget, Goyal had said during the renewable energy global investor meet Re-Invest 2015 that he would like to see the inverted duty structures being removed and a stable policy. Inverted duty structure refers to taxation of inputs at higher rates than finished products. While the industry was expecting concessions, Goyal had said that the industry is strong enough to work without additional allocation and subsidies.
Experts agreed that the Budget has done its bit to help the renewable energy sector.
“The indirect tax related amendments do seek to address certain inverted duty structures prevalent in the solar energy vertical and start to reflect a clear policy shift towards renewables,” BMR Advisors said in a statement.
People in the industry also see a lot of indirect benefits for the renewable energy sector in the various Budget proposals.
“A key positive for the renewable energy is the tax-pass through status considered for Alternate Investment Funds. A large portion of equity investment in renewable energy is expected to come from private equity capital which is sourced from global markets,” said RM Malla, Managing Director and Chief Executive Officer, PTC India Financial Services Ltd.