The Finance Minister should put into place a comprehensive policy and regulatory framework to encourage firms to invest more in innovation and technology with the larger objective of bringing about a transformation in the power sector. The skewed tariffs of downstream distribution utilities should be rationalised vis-à-vis the cost structure to optimise cross-subsidy and create competitiveness in the industry.
Measures to facilitate timely payments from states to upstream utilities will take care of cash flow constraints. We also expect the Finance Minister to incentivise investments in R&D in renewables and storage technologies. The government should create a robust ecosystem for indigenous solar manufacturing through allocation of more funds, extension of financial assistance on term loans, upfront central financial assistance on CAPEX and exemptions in basic custom duty to units in Special Economic Zones to realise its vision of Atmanirbhar Bharat.
It should create a separate category for renewable energy under priority sector lending to enable independent power producers to get more funding from banks. Let us capitalise on the Indian Renewable Energy Development Agency further and create a specialised infrastructure funding institution which can refinance operating assets at competitive rates.