A cornerstone of the Budget’s green agenda is the 'National Manufacturing Mission' designed to support the growth of domestic industries under the 'Make in India' initiative
Union Finance Minister Nirmala Sitharaman presents Union Budget 2025 in the Lok Sabha, in New Delhi, on Saturday. Pic/PTI
The Union Budget for 2025-26 unveiled key initiatives aimed at strengthening India’s climate resilience and supporting the nation’s energy transition. Finance Minister Nirmala Sitharaman introduced the 'National Manufacturing Mission', 'High Yielding Seeds Mission', and 'Nuclear Energy Mission', focusing on renewable energy, climate-friendly technologies, and enhancing agricultural resilience.
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While these measures were welcomed by several industry experts, some climate advocates argued that Budget 2025 did not deliver the bold and comprehensive climate action that India urgently requires, reported news agency PTI.
Solar panels, EV batteries, and clean tech manufacturing boosted
A cornerstone of the Budget’s green agenda is the 'National Manufacturing Mission', designed to support the growth of domestic industries under the 'Make in India' initiative. Sitharaman emphasized that this mission would focus on manufacturing clean technologies such as solar PV (photovoltaic) cells, electric vehicle (EV) batteries, wind turbines, and electrolyzers.
“Given our commitment to climate-friendly development, the mission will also support clean tech manufacturing,” stated Sitharaman.
To further stimulate local production, the government has removed basic customs duties on key materials, including cobalt powder, lithium-ion battery scrap, and critical minerals. This move aims to lower input costs, secure raw material supply chains, and create jobs in renewable energy and electric mobility sectors, which are critical to India’s energy transition, PTI reported.
Support for farmers and climate-resilient agriculture
In a significant push for climate resilience in agriculture, the government will launch the 'National Mission on High Yielding Seeds'. The initiative aims to improve seed research and develop varieties that can withstand droughts, pests, and extreme weather patterns, which are increasingly affecting India’s farming community.
Nuclear energy to play a key role
The Union Budget also placed a strong emphasis on nuclear energy, with an ambitious goal of generating 100 GW (Gigawatt) of nuclear power by 2047 as part of India's clean energy transition. A new 'Nuclear Energy Mission' will focus on the research and development of Small Modular Reactors (SMRs), with an outlay of Rs 20,000 crore. Sitharaman also announced that at least five indigenously developed SMRs will be operational by 2033, PTI reported.
Additionally, the government plans to amend the Atomic Energy Act and the Civil Liability for Nuclear Damage Act to allow private sector participation in nuclear energy development.
Mixed reactions from experts
While many lauded the initiatives, some experts expressed concern that Budget 2025 fell short of addressing the climate crisis with the urgency and scale needed.
Sunil Dahiya, Founder and Lead Analyst at EnviroCatalysts, said, “The marginally increased allocation under Finance Commission grants (under Ministry of Housing and Urban Affairs) to urban areas, a part of which in the past was directed towards National Clean Air Programme (NCAP) for million plus cities, infers that the support for clean air actions to urban areas is continued, though clarity on this is still awaited.”
He added, “Lack of a bold statement to tackling air pollution and reducing reliance on fossil fuels to decarbonise the energy sector is a major gap but a push for rooftop solar, reduced import duties on solar and battery components, investment in grid infrastructure, and initiatives such as PM-eBus, Atal Mission for rejuvenation and Urban Transformation (AMRUT), and Swachh Bharat are welcome steps contributing to overall progress towards reducing air pollution and supporting energy transition. A clear roadmap for India’s energy transition is essential to effectively address both air pollution and climate challenges and we look forward to targeted resource allocation and actions towards it."
Harjeet Singh, climate activist and Founding Director of Satat Sampada Climate Foundation, noted that the Budget’s focus on boosting EV battery manufacturing and climate resilience in agriculture was insufficient. “The Budget lacks a renewed commitment to scaling up renewable energy, tackling deadly air pollution, restoring ecosystems, and safeguarding communities on the frontlines of the climate crisis,” Singh said.
Saurabh Kumar, Vice-President of Global Energy Alliance for People and Planet (GEAPP), however, praised Budget 2025 for supporting renewable energy and positioning India as a key player in the global clean technology supply chain. He noted that the National Manufacturing Mission would boost domestic production of solar PV cells and grid-scale batteries, enabling India to become a critical link in the global energy transition.
Hisham Mundol, Chief Advisor at the Environmental Defense Fund, highlighted the importance of diversifying the energy mix, pointing to the 100 GW nuclear target as a positive development. "This is a strong target to pursue," he said.
(With inputs from Dipti Singh and PTI)
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