Budget has positive announcements for infrastructure and power sectors: Anil Chaudhry

The 2015-16 Budget announced by the Government has positive announcements for the infrastructure and power sector, particularly renewable energy. Investments in infrastructure being increased to Rs 70,000 crores should spur renewed interest in many projects across the country. The five new ultra-mega power projects of 4,000 MW each in the plug-and-play mode and commissioning of the Kudankulam nuclear power station in 2015-16 clearly sets the tone in this regard.
 
The renewable energy capacity target being revised to 175,000 MW (100,000 MW Solar, 60,000 MW Wind, 10,000 MW biomass and 5,000 MW small hydro) also augurs well for the clean energy sector. The increase in clean energy cess from Rs 100 to Rs 200 per metric tonne of coal, lignite and peat to finance clean environment measures and concessions on custom and excise duty for electrically operated vehicles and hybrid vehicles being extended up to 31 March 2016 are also good news for the environment and renewable energy.
 
Additional depreciation at 20% being allowed on new plant and machinery installed by manufacturing units or a unit engaged in generation and distribution of power; the electrification of 20,000 villages, including with off-grid solar power, by 2020; and connecting 178,000 unconnected habitations are other positive measures. Reduction in basic customs duty to reduce the cost of raw materials for Active Energy Controllers used in manufacturing renewable power system inverters to 5% (subject to certification by the Ministry of New and Renewable Energy) is also a welcome step.
 
An announcement of direct or indirect tax benefits for the adoption of energy efficiency measures would have been welcome as it would have served to bridge the gap between energy supply and demand.
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Anil Chaudhry is the country president and MD of Schneider Electric India