"India doesn’t have a choice when it comes to energy transition," says Saurav Kumar

Nation Wants to Grow: In the lead-up to the Union Budget 2024-25 set to be announced on July 23, Saurav Kumar, Vice President of India at the Global Energy Alliance, underlined the nation’s imperative to adopt electric vehicles (EVs) and clean energy during Republic Business’ pre-Budget panel discussion, “Nation Wants to Grow.”

Kumar mentioned that India has no choice but to embrace EVs, given the nation's collective targets for economic development with clean energy. He highlighted the critical issues and challenges India faces in this endeavour, noting that the country must forge its own path, a task he believes India is fully capable of achieving.

“If you look at the government policies in the last 10 years, it demonstrates the will to overcome these challenges. We also need to make sure that we become a role model for the global south and that's that is why it is critically important that we, in this budget lay out the priorities for energy transition, not just inclusive, but also building on the good work of energy efficiency, said Kumar.

Kumar also noted the global context, with a slowing Chinese economy and increasing demand for clean energy equipment and EVs, making India a prime investment destination. He mentioned the United States' Inflation Reduction Act, which attracts manufacturing, but he also highlighted India’s cost advantage. “It is essential that India does not miss the manufacturing bus this time around, especially in battery storage,” he said.

Addressing the domestic scenario, Kumar pointed out that despite the Production Linked Incentive (PLI) scheme for advanced cell chemistry, there still needs to be more demand for energy storage in India.

Kumar stressed the need for demand generation alongside policy stability. “India is becoming an investment destination. While the USA has introduced policies like the Inflation Reduction Act, which is attracting manufacturing there, India largely holds a cost advantage compared to any other nation. Therefore, it is essential that India does not miss the manufacturing bus this time around, particularly in battery storage,” added Kumar.

Kumar believes that if we miss the chance to become a manufacturing hub, we will again become dependent on other manufacturing centres when the actual domestic demand emerges. “A lot of manufacturing, despite the PLI, has not happened because domestic demand has not been generated,” he added.

The discussion also touched on skill gaps in public sector units and state governments. Kumar called for efforts to bridge these gaps, especially in energy and other sectors, to accommodate new technologies and ways of working.

The panel recognised the private sector’s pivotal role in development investments. It underlined the need for appropriate risk mitigation measures and credible blended finance instruments in the budget to support initiatives like charging infrastructure and energy storage. Kumar reiterated the high duties on energy storage and the necessity for their reduction until domestic manufacturing gains momentum.

As India approaches the announcement of its budget, these insights underline the critical need for strategic policies and investments to support the country’s clean energy and EV aspirations.