India seizes green opportunity with 2011-12 Union Budget
- 04 March 2011
India’s clean industrial revolution has received fresh government support as the Minister of Finance Pranab Mukherjee announces multiple green measures and rebates in his annual budget speech. The Union Budget of 2011-12 announcements clearly indicate Indian government’s decisive plans to promote and develop clean energy and technologies, which will advance India’s Clean Revolution.
Key points from the Finance Minister’s speech included:
- Planned launch of National Mission in hybrid and electric vehicles
- Allocations of Rs 400 crore from National Clean Energy fund for speeding up The National Mission for a Green India
- The budget of the Environment Ministry increased by around Rs 300 crore
- Extension of Tax holiday for the power sector by one year
The Ministry of New and Renewable Energy which is focusing on numerous clean energy programs, got a 20% budget hike, from Rs 1,008.50 crore, to Rs 1,212 crore. Rs 176 crore has also been allocated to developing renewable energy for rural applications this year, and another Rs 77.50 crore has been given to the Ministry for research, design and development in the renewable energy sector. Allocation of Rs 664 crore has also been announced for grid-interactive and distributed renewable power.
To add momentum to the ambitious 10-year Green India mission, allocation of Rs 200 crore has each been announced for protection and regeneration of forests, environmental remediation programs and clean-up of important lakes and rivers.
Also widely welcomed has been the tax exemption extension for the power sector, which is as a positive step by the Government to increase power generation capacity for meeting its growing needs.
As well as the plans for a National Mission in hybrid and electric vehicles, a reduction in excise duty from 10% to 5% on kits used for conversion of fossil fuels to hybrid vehicles, and an excise duty of 5% for critical parts of hybrid vehicles manufactured domestically has also been announced. More highlights include concessional excise duty of 10% to vehicles based on fuel cell technology as well as full exemption from basic customs duty, plus a concessional 4 % rate of central excise duty, for batteries imported by electric vehicle manufacturers.
LED lights also have rebates which will now attract a reduced excise duty of 5%. The lights and light fixtures are now fully exempted from 4% special countervailing duty.
The Union budget is very much in tune with India’s ambition to be part of the larger Clean Revolution, aimed at an economy which balances developmental needs with a cleaner, smarter and more prosperous future.