India banking on foreigners for 15% of its $50 bln cleantech ambitions

Quoting a government official, Bloomberg reported today that India may seek at least USD7.5 billion of the USD50 billion it’s planning to invest in clean energy in five years from foreign direct investment.

“We’d like a bare minimum of 15 percent of that coming as FDI over the next five years,” Gireesh Pradhan, secretary at the Ministry of New and Renewable Energy, said in an interview with Bloomberg in London.

Prime Minister Manmohan Singh plans to spend more than USD300 billion in the five years to March 2017 to expand India’s electricity systems in an attempt to spur 9 percent economic growth by then. An increasing share of that may be allocated to renewable projects as lenders shun new conventional power projects that face rising fuel costs.

India would like to “get the maximum that one can get” from overseas investors, Farooq Abdullah, minister for new and renewable energy, said in the same interview. He said he was assuring investors of concerns about whether policies and tax structures for renewable energy projects will remain.

“We feel that renewable energy is the future, not only of India but also the world,” Abdullah said. “Fossil fuels are gradually disappearing and the environmental damage that has been done by them has been of an immense nature.”

India outpaced the rest of the world in investment in clean energy in 2011 due to improving cost competitiveness of wind and solar projects, according to Bloomberg New Energy Finance. India’s clean energy investments were USD10.3 billion last year compared with USD6.8 billion invested in 2010, the highest growth figure of any significant world economy, according to the London-based industry analyst.