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The government cuts GST on renewable energy equipment from 12 percent to 5 percent, boosting Mission 2030 goals.
News18
In order to boost clean energy adoption across the country and achieve its Mission 2030 renewable energy targets, the government has cut the Goods and Services Tax (GST) on renewable energy equipment from 12% to 5%.
It will help to spur the progress in clean projects by lowering project costs, making tariffs more competitive, and encouraging faster adoption of clean power across industries and utilities.
Experts from the renewable energy sector have welcomed the decision, calling it a progressive step that will bring down capital expenditure and strengthen domestic manufacturing.
Rajeev Kashyap, SVP and General Manager for India, Middle East, and Africa at Nextracker, said the reform eases the tax burden on critical components and reinforces the government’s commitment to clean energy. “This reform will benefit developers, power producers, and consumers alike by lowering project costs, enhancing viability, and enabling faster adoption across industries and utilities,” he noted. Kashyap added that the policy change also strengthens the case for domestic manufacturing, making India’s supply chain more resilient and attracting greater investment into the sector.
Echoing similar sentiments, Akshay Hiranandani, CEO of Serentica Renewables, said that the tax cut will significantly improve cost efficiency. According to him, “Lower capital costs will translate into more competitive tariffs in auctions, supporting quicker capacity addition and passing direct benefits to consumers.”
Simarpreet Singh, Executive Director and CEO of Hartek Group, described the GST 2.0 reforms as a “decisive step” towards accelerating renewable adoption. He highlighted that reducing the tax burden on capital-intensive projects would improve returns and encourage private participation. Singh also stressed that consistency in taxation is key to sustaining investor confidence and ensuring sectoral stability in the long run.
Industry leaders agree that the tax rationalisation will improve the financial viability of projects and support India’s ambition to meet its Mission 2030 renewable energy targets.
Srivatsan Iyer, Global Chief Executive Officer, Hero Future Energies (HFE)
“The reduction of GST on renewable energy equipment from 12% to 5% is a welcome step that strengthens the foundation of India’s clean energy transition. A simpler and lower tax structure makes renewable energy more affordable, while boosting domestic manufacturing and investor confidence.
This reform enhances the sector’s competitiveness and reflects India’s steadfast commitment to its 2030 renewable energy targets and 2070 net-zero vision. More affordable clean technologies will accelerate adoption, strengthen energy independence, and create green jobs—bringing the nation closer to a sustainable future”
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst…Read More
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst… Read More
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