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Tax sops for investing in renewable and clean technology

Tax sops for investing in renewable and clean technology
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First Published: Fri, Aug 03 2007. 06 12 PM IST
Updated: Fri, Aug 03 2007. 06 12 PM IST
New Delhi: The government is planning tax breaks and other incentives to promote investment in India’s renewable energy sector.
Urging Indian industry to take full advantage of incentives offered, Mr. V. Subramanian, Secretary, Ministry of New & Renewable Energy emphasized the need for professional investment in the sector while addressing the India Cleantech Forum “Cleantech Solutions for Sustainable Development: Meeting Challenges and Opportunities” organized by CII in partnership with CleanTech AustralAsia on 3August. The one-day event was attended by over 250 persons representing industry, government departments, academia, civil society and media persons from nearly 10 countries.
Distinguishing features
* India is the only country to have a separate Ministry to look after new and renewable energy.
* Technology and innovation play a crucial role in maintaining energy efficiency, which is reflected via reducing energy and carbon intensities.
* An enabling policy framework is required along with capital including incentives to encourage investment in clean technologies.
* In the context of addressing twin challenges of poverty and meeting the energy demand in rural India, several opportunities exist in India which can be duly tapped.
* In recent times India was increasingly becoming a part of the solution and was not contributing to the problem.
Stressing on the need for a positive shift in government policies in facilitating investment, Mr. Subramanian urged CII to create a database of professionals including investors in the renewable energy (RE) sector to facilitate networking among stakeholders.
The objective is to promote more and easier investment in clean technology besides promoting infrastructure for the growth of RE while exploring innovative hybrid RE solutions.
Recommendations
The RE sector depends on regulatory clearances for investment. There is need for a shift in government thinking.
Highlighting an example where the government policy on feed-in-tariff system led to more investment in wind energy, Mr. Subramanian suggested such a policy be in place for investment in solar energy.
Mr. Uday Khemka, Vice-Chairman of the London-based Sun Group, said that the time was ripe to take the Kyoto Protocol to the next level. The U.S particularly could speed up climate change related legislation.
Impact of climate change included de-glacial effects, coastal flooding and shifts in monsoon patterns offered investment opportunities for businesses.
Mr. Dusty Wunderlich, Vice President, Investment Banking, ARVCO Capital, USA said there were ample opportunities in emerging markets for the international business community to invest in India. His company was committed to facilitating investment in India and had hiked investments in clean technologies from $350 mn in pre-2000 days to$2.5 mn in 2006.
India is a key market for cleantech investment which can be gauged by IFC’s investment of $1 billion last year in India. IFC has come out with a module to guide municipalities in energy management which will help them save 20-30% energy.
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First Published: Fri, Aug 03 2007. 06 12 PM IST