NEW DELHI: India's renewable energy industry is likely to generate business opportunities worth $160 billion in the next five years, a finance ministry report said on Friday, the day before a federal budget that is set to boost clean energy funding.
Prime Minister Narendra Modi is banking on renewables to fight climate change rather than committing to emission cuts like China. He has set ambitious clean-energy targets including raising solar capacity fivefold to 100 gigawatts (GW) by 2022.
"It offers a very good opportunity for businesses to set and scale up industry, leapfrog technologies and create volumes," the economic survey report said.
The report, authored by the government's chief economic adviser, Arvind Subramanian, said "immediate plans" include scaling up total renewable capacity to 170 GW from 33.8 GW.
US-based SunEdison and First Solar have already said they would build more than 20,000 megawatts of clean energy capacity in India by 2022.
While the bulk of the future investment will come from the private sector, Finance Minister Arun Jaitley is expected to raise the government allocation for renewable energy for the next fiscal year from the 25.19 billion rupees ($407 million) for this current year ending March 31, a government source said.
The economic survey report cautioned against an excessive reliance on fossil fuel, despite Modi's commitment to supply round-the-clock power to all of India's 1.2 billion people by 2019.
India still has 280 million people living without power in 56 million homes.
The report said that "we have an opportunity to avoid excessive dependence on fossil-fuel-based energy systems and carbon lock-ins that many industrialised countries face today".
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