Govt’s Tax Holiday for Startups will Encourage Innovation in EV, Energy Storage: Dr Walawalkar

The government’s tax holiday for startups will definitely encourage the new innovation in electric vehicle (EV) and energy storage sector and help startups in the segment to flourish in India, said Dr Rahul Walawalkar, President of India Energy Storage Alliance (IESA) on the one year time extension for start-ups for claiming tax holiday.

February 02, 2021. By Manu Tayal

The government’s tax holiday for startups will definitely encourage the new innovation in electric vehicle (EV) and energy storage sector and help startups in the segment to flourish in India, said Dr Rahul Walawalkar, President of India Energy Storage Alliance (IESA) on the one year time extension for start-ups for claiming tax holiday.

Dr Walawalkar also mentioned that, this will provide a competitive platform for Indian startups to compete with global players.

Finance Minister Nirmala Sitharaman, during Budget 2021 presentation, announced extension of tax holiday claim for start-ups by one more year, and capital gains exemption for investment in startups extended till March 31, 2022.

On increasing duty on solar invertors and lanterns from 5 per cent to 20 per cent and 15 per cent respectively, Dr Rahul opined that, This step will make the country self sufficient and not rely on other countries. Also, Chinese companies manufacturing in India will get a price edge over others.

While, increase in custom duty on auto parts is a step by the Ministry to make the country self-sufficient and reliant, he added stating that this gives an opportunity for the local manufacturing and OEMs and will boost the sector.

By welcoming the government’s proposed Hydrogen Energy Mission, Walawalkar shared that, in line with the industry needs, IESA has already launched the MIGHT- (Mobility and Infrastructure with Green Hydrogen Technology) initiative in 2019 for supporting policies to enable use of green hydrogen in both stationary and mobility sector.

On the other hand, he anticipated that advanced chemistry cell battery manufacturing mission and hydrogen mission together can enable India to fast track decolonization of grid, industrial sector and transportation sector in coming decade.

Considering government’s scrapping policy announcement a significant move, Walawalkar said, the announcement about the vehicle scrappage policy is a great opportunity and a welcome step. Under IESA’s EV Adopters Circle, we are looking to help the companies and individuals to evaluate benefits of switching from ICE vehicles to EVs.

In order to promote domestic manufacturing, the government has announced Rs 1.97 lakh crore in next 5 years for Production Linked Incentive (PLI) schemes in 13 sectors. On the announcement, he commented, that this national program holds immense importance as it is going to accelerate the Atmanirbhar Abhiyan in domestic manufacturing, helping India to enter the global value chain for advanced energy storage technologies. IESA is committed to develop India’s robust R&D and manufacturing sector including complete supply chain for manufacturing in coming years.

To strengthen overall research ecosystem with focus on national-priority thrust areas, Finance Minister in the Budget 2021 announced Rs 50,000 crore outlay over 5 years for the National Research Foundation. By appreciating the move, Dr Rahul stressed on the need that, there is a need for R&D to support the AtmaNirbhar Bharat mission and it is high time for the Indian industry to take up R&D and advanced cell manufacturing so that we reduce our dependence on other countries.

For raising the share of public transport in urban areas, Finance Minister announced the expansion of metro rail network and augmentation of city bus service, and Rs 18,000 crore allotted for a new scheme to augment public bus transport. Dr Walawalkar said, the new scheme will help in accelerating the adoption of Electric Vehicle in State Transport Undertakings.

On Rs 15,700 crore budget allocation to MSME sector by the government, he commented I applaud the financial influx in the MSME sector and supports the need for an infrastructure fund dedicated to the rural.

While on the enhancement of Rural Infrastructure Development Fund to Rs 40,000 crore from earlier Rs 30,000 crore, Dr Rahul Walawalkar opined, this is a step in right direction.

IESA launched MICRO (Microgrid Initiative for Campus and Rural Opportunities) in 2016 with a goal of improving the economic sustainability of microgrids in India.

This initiative addresses the fundamental challenges faced by the developers and funding agencies by creating an ecosystem to make micro-grids viable and efficient and is actively engaging with the community. We are confident that energy storage and microgrids have the potential to transform not just India’s electric grid in next 5-10 years, but also to help advance energy access challenges around the globe, he added.

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