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4.67. India offers other financial and fiscal incentives to assist enterprises and to promote the use of renewable energy. Industrial "units", including MSMEs, were offered assistance by the states, such as refunds on electricity bills, and exemption and reimbursement of local electricity taxes. (...)

4.68. (...) Commercial banks grant preferential loans only for renewable energies, under the priority-sector lending requirement.

4.71. Electricity generation relies on conventional and non-conventional sources. Thermal energy (mainly coal) remains the main source, but the share of renewable energies from various sources (solar, wind, biomass, and small hydro) in the total installed capacity grew steadily, from 14.6% in December 2015 to 23.7% in June 2020 (Chart 4.1).

4.72. Under the Electricity Act, 2003, a Renewable Purchase Obligation (RPO) was established to further promote the use of renewable energies. In 2018, the Ministry of Power stipulated that, under the RPO, 21% of the total electricity supplied by 2021/22 must be from renewable sources of energy. In addition, financial assistance is provided by the Central Government to increase small-hydro, biomass, and solar electricity generation (Table 4.10). Financial support is also granted to small-scale off-grid renewable energy projects, such as the installation of solar panel roof-top systems, to meet the demand of isolated households.

Table 4.10 Selected incentive schemes provided by the Ministry of Natural and Renewable Energies
Objective- Eligible entities- Financial assistance- Duration

Small hydro-power projects (<25 MW)- Private sector- INR 10 million/MW or INR 15 million/MW, depending on the location, subject to a maximum grant of INR 50 million- 2014-17;

Biomass-based co-generation projects- Sugar mills and other industries- INR 2.5 million/MW to INR 5 million/MW- 2018-20;

Installation of solar water pumps- Farmers- 50% of the project cost in the special-category states; 30% in the remaining states- 2019-22

4.75. The National Manufacturing Policy (NMP) aims to rationalize and simplify business regulations; simplify policies to close unviable units and pay suitable compensation to unemployed workers; and facilitate the redeployment of company assets. It also established the Technology Acquisition and Development Fund for the acquisition of appropriate technologies, the creation of a patent pool, and the development of domestic manufacturing of pollution-control and reduced-energy-consumption equipment, including through incentives. [123] Other provisions in the NMP include (...) the creation of national investment and manufacturing zones (NIMZs). NIMZs are large integrated townships with state-of-the-art infrastructure, land use on the basis of zoning, clean and energy-efficient technology, (...)

[123] The incentives included 5% reimbursement of the nominal interest charged by the lending agency, and 10% capital subsidy.

4.88. The target for small finance banks, which have limited functions, principally accepting deposits and making loans, is higher, at 75% of their ANBC. On 10 May 2018, the RBI issued revised guidelines on lending to the priority sectors for urban cooperative banks, which added medium-sized enterprises, social infrastructure and renewable energy to the priority sectors, with a 7.5% target for micro-enterprises; in addition, the distinction between direct and indirect agriculture, and loans for education in India and abroad, were removed. (...)

4.126. (...) The national highway network accounts for 2.2% of total roads. The development of roads has been a challenge due to the lack of resources, lengthy procedures to acquire land, delays in construction, and environmental issues. (...)

Table 4.21 Central Government financial assistance under the SagarMala Programme
(...)
Projects: Combatting oil pollution in all ports
Maximum amount of financial assistance: 50% of the total cost of equipment
Total outlay (Nov. 2019): INR 1.2 billion
(...)

4.162. The Ministry of Tourism (MOT) formulates and implements the national tourism policy. During 2015-20, India continued to implement the National Tourism Policy (NTP) 2002, which is aimed at making tourism a sustainable tool for economic and social growth. (...) In 2020, a new, draft NTP 2015, that focuses on a sustainable and inclusive tourism model, was being reviewed.