The announcement on operationalising small modular reactors (SMRs) i.e. Bharat SMRs by 2033 came on top of already approved 7 GW of nuclear capacity to be set up by 2031 in fleet mode. The budgetary allocation for nuclear power projects for 2025-2026 is INR 2,086 crore.
The budget also emphasised India’s focus on strengthening domestic supply chains by boosting local manufacturing of solar PV cells, batteries, and wind turbines, supporting the country’s long-term energy security goals.
This Budget unveiled the National Manufacturing Mission, boosting ‘Make in India’ with INR 100 crore allocation for 2025-2026. The budget’s basic customs duty exemption on cobalt powder, lithium-ion battery scrap, and other critical minerals aimed to strengthen India’s recycling industry.
Key allocations from the past budgets include INR 19,500 crore for solar manufacturing in 2022, helping India reach 63 GW of solar-module and 5.8 GW of solar-cell capacity by December 2024. In 2023, INR 19,744 crore was allocated to the National Green Hydrogen Mission, alongside a viability gap funding for battery storage. In 2024, support for 1 GW offshore wind along with the PM Surya Ghar scheme helped rooftop solar capacity to reach 15.7 GW.
Ruchita Shah, Ember’s Asia Energy Analyst for India, said: “Union Budget 2025 focuses on long-term energy security with plans to increase nuclear capacity to 100 GW by 2047, further diversifying India’s energy mix. However, the journey from 8.2 GW today to 100 GW in 22 years will require a series of interventions. While this is a positive step, a renewed push is needed in the short-term to meet the existing solar, wind and energy storage targets by 2032; for that, significant steps are expected throughout the year.”
Duttatreya Das, Ember’s Asia Energy Analyst for India, added: “Building on previous years’ progress, the announcement of the National Manufacturing Mission is a positive step toward achieving self-reliance in the clean energy transition in the long run. The reduction in basic customs duty on various waste and scrap of critical minerals, including lithium-ion batteries, is a welcome move that can strengthen the critical mineral availability for the domestic production of key components such as solar PV cells, batteries and wind turbines.”
In conclusion, despite the forward-looking directions in the budget, from a short-term perspective and priorities, the budget has not explicitly dealt with the expectations on continued support for wind energy, transmission infrastructure and energy storage, green hydrogen and industrial decarbonisation.
