downtoearth-subscribe

Energy funding shifts to hi tech projects

FINANCE minister Manmohan Singh contends non-conventional energy sources (NCES) have been given a boost through customs duty reductions of upto 20 per cent on a variety of items and continuation of the tax holiday for renewable energy projects.

Funding for solar and wind energy programmes have been raised from 22.9 per cent in 1992-93 to 35.34 per cent of total budget allocation for NCES this year. Biogas, improved chulhas and biomass plantations have all had their funding drop sharply.

The 1993-94 outlay for NCES is Rs 204 crore, a jump of nearly 60 per cent from the Rs 129 crore allotted to it in 1992-93, the debut year for NCES as a separate ministry. But as a percentage of the total outlay in the energy sector, the raise is marginal -- from 0.76 per cent to 0.89 per cent.

The cost of production of solar cells in India is still high, which means more of R&D is essential. Drastic cuts in import duties on solar cells and modules, from 60 per cent to 45 per cent, and on photovoltaic systems, from 80 per cent to 60 per cent, may stimulate manufacture and application of photovoltaic systems. But the down side is that this could stifle public-sector production.

Rakesh Bakshi, director of a firm manufacturing wind generators and systems, contends the budget is not friendly to renewable energy. He pointed out import duty on conventional power projects and equipment has been reduced to 20 per cent, but wind-powered generators of electricity have had duty reduced from 45 per cent to 25 per cent. "The finance minister must correct this anomaly," Bakshi urged.

Officials in the ministry of non-conventional energy sources say they are surprised import tariffs have been pegged above those applied to conventional power systems and want a reduction to at least 20 per cent.

Related Content