Subsidies, PLIs are detrimental to long-term growth of cleantech: Piyush Goyal

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Production linked incentives (PLIs) can only give an initial boost to cleantech, Union minister for commerce and industry Piyush Goyal said on January 10, adding that the industry must stand on its own feet for India to be self reliant.

"I personally believe and I have held that belief all through my 10 years in government that incentives and subsidies only harm a sector... At best, PLIs can help us kick-start the process and give an initial boost, but ultimately we have to accept that (an) industry has to stand on its own feet. Business has to be an economically viable proposition, and anything force-fed, anything working on mandates is bound to fail," Goyal said in his keynote address at the Bharat Climate Forum in New Delhi.

He justified his statement with India's LED bulb revolution, which was lapped up by the entire country without any major incentive or subsidy. "And that's how the world's largest adoption of LED was started in India. We brought down the cost of LED bulbs from Rs 500 to about Rs 40-50," he said.

Goyal said reliable power would increasingly become a necessity with data centres coming up globally. "India has an advantage because we have large interconnected grid which increases the reliability of power. And they (countries across the globe) desperately need reliability of power if they want to bring data centers to any part of the world. With India's 500 gigawatt (GW) non-fossil fuel power generation capacity planned by 2030, they can get clean or green data centers in the country with reliable power."

Speaking at the same event, India's G20 Sherpa Amitabh Kant said India's private credit to the gross domestic product (GDP) must go up as it is lower compared to the US, Europe and China,

"If India does not make a major radical shift towards cutting-edge technology, it will remain a huge importer of clean technology. We need young entrepreneurs. We need to disrupt and we need to take China head on," Kant said.

"My belief is that without India becoming a global champion in sunrise sectors, we would not be able to achieve the target of becoming a developed nation by 2047, we will never be able to become a $32 trillion economy," he said.

Jagjeet Singh Sareen, Partner, Global Climate Practice at Dalberg Advisors and Member-Secretary of the Bharat Climate Forum, said mitigating climate change requires urgent acceleration of efforts.

"We need innovative financing mechanisms, such as green bonds and impact bonds, to raise capital efficiently, linking climate benefits to funding solutions. Additionally, localising the supply chain could save nearly $2 trillion in imports by 2047, reducing India's reliance on fossil fuels and external technologies. Through the Bharat Climate Forum, we hope to advance these critical conversations," Sareen added.