Govt plans 3 mega manufacturing zones

New Delhi: The Ministry of New and Renewable Energy (MNRE) and the Ministry of Power (MoP) have proposed a scheme for the setting up of three manufacturing zones for renewable energy and power equipment—two brownfield manufacturing zones, and a greenfield manufacturing zone in a coastal area—with a total financial outlay of Rs1,000 crore.

There is a ceiling of Rs400 crore as grant-in-aid from the Central government for any zone. The grant-in-aid shall be released in four installments spread over a period of five years.

The two brownfield manufacturing zones will come up on the land that is already developed, official sources told Bizz Buzz. The zones will come up by 2026-27. The government has already called an expression of interest (EOI) for a brownfield manufacturing zone for one location. It is expected to commence this fiscal.

The EOI Process Authority, acting on behalf of the Central government, intends to select the successful proposer for setting up of the brownfield manufacturing zone for power and renewable energy equipment.

The objectives are: establishing a manufacturing facility based on cutting edge, clean and energy efficient technology for minimizing dependency on import of equipment/critical component/critical spares, etc., required for the power sector and renewable energy equipment; promoting Make in India and Atmanirbhar Bharat; promoting indigenization; setting up an exclusive manufacturing zone by providing hassle-free allotment of land and clearances, state of the art common testing facility or CTF; and exploiting the benefits arising due to optimization of resources and economies of scale.

State governments or State government entities, including public-sector undertakings (PSUs), in partnership with the State government can submit proposals for setting up the manufacturing zone in their state.

Private entities and Central PSUs can also partner with State governments to set up the manufacturing zone in the respective states. In the joint venture between the private entity/CPSU and a State government agency, the State should hold a minimum of 26 per cent equity.

"The MNRE-MoP scheme has been formulated to reduce the country's reliance on imports. While the growth of the domestic power sector in the last decade has been impressive, we continue to depend a lot on imports to meet the growing domestic demand of power and renewable energy equipment. This trend is likely to continue, unless domestic capacity is ramped up with suitable policy support," officials said.

The target of 450 GW of renewable energy capacity offers a tremendous opportunity to create skilled jobs, bring about technology transfer, and contribute to the Make in India campaign, in addition to reducing the country's trade deficit and reliance on imports.