Budget 2024: Govt scraps import taxes on critical minerals to aid RE sector

By Lou Del Bello

India will remove import taxes on 25 critical minerals and ramp up efforts to develop small-scale nuclear reactors to speed its adoption of clean energy, Finance Minister Nirmala Sitharaman said in her budget speech.
 

Duties on metals including copper, lithium and cobalt will be lifted to aid the domestic development of sectors like renewable electricity and aerospace, she said in the speech on Tuesday.

The government will consider partnerships with private companies to build reactors locally, while also increasing funding for research and development, Sitharaman said. The minister also said a Critical Mineral Mission would be started to boost local refining and recycling as well as acquisitions of assets outside India.

“This initiative also aligns with the China-plus-one global strategy, as currently China holds 70% to 90% of the world’s processing capabilities,” said Rakesh Surana, partner at Deloitte India.

The latest policies follow a 1 trillion-rupee ($12 billion) spending package on so-called sunrise technologies that was announced by the government in February. India also said earlier this year that it was aiming to cooperate with France on the development of small, modular reactors. Dozens of companies globally are working on these reactors, with most pitched as more flexible and lower-cost than existing plants.

“As part of diversity in the energy mix, there is a role for safe, smaller nuclear,” said Hisham Mundol, chief Indian advisor with the Environmental Defense Fund. However, while India is good at mass market innovation and low-cost engineering, “the transformational scientific breakthroughs required to mainstream safe” small-scale nuclear energy are still a long way away, he said.

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