India’s renewable energy industry has given a thumbs up to Indian Prime Minister Narendra Modi, with as many as 78% of respondents in Bridge to India’s India Re CEO Survey 2019 survey claiming that Modi’s government has driven industry growth over the past five years by increasing the renewables target to 175 GW. Top executives from 41 Indian and international companies participated in the survey.
Almost 73% of CEOs also said they remain upbeat about the country’s renewable growth prospects, despite recent policy reversals and various other operational challenges faced by the industry. India is set to add 80 GW of renewables over the next five years, with 47 GW expected to come from utility-scale solar. Installations of floating solar and grid-scale storage are also expected to pick up pace.
The outlook for rooftop solar, however, is fairly conservative, with 78% of the survey respondents saying that they expect India to add less than 10 GW capacity during the period. In addition, about 56% of the survey respondents said they are pessimistic about the prospects for domestic manufacturing.
Indian states such as Gujarat, Andhra Pradesh and Karnataka topped the list in terms of the overall ease of doing business. Other states such as Tamil Nadu, Uttar Pradesh and Haryana occupied the bottom three spots of the list.
However, the survey respondents said that the Modi government has failed to maintain consistent policies. The imposition of trade barriers and GST has created uncertainty and confusion for businesses, they claimed. The most pressing issue for the industry is offtake risk, followed by challenges related to land acquisition and uncertainty in the overall policy environment. Almost half the respondents said that they feel that bidding in the sector is irrationally aggressive.
That said, the industry generally expects the government to improve business execution and provide policy stability.
“Overall, the survey paints an optimistic picture for renewable energy sector growth,” said Vinay Rustagi, managing director of Bridge to India. “If effective measures for discom reform and network connectivity are put in place, we can expect much higher capacity additions in coming years. We also believe that the sector enjoys broad cross political support and there is unlikely to be retreat irrespective of who forms the government.”