To start with, the government plans to provide viability gap funding (VGF) of Rs.1,000 crore for setting up grid-connected solar projects of 1,000MW capacity by the Indian Army, which would provide electricity to one of the largest consumers in the country at a tariff of Rs.5.50 per unit. Also, the government plans to give VGF—financial grants offered to projects that are important but may not be immediately viable financially—to CPSUs such as NTPC Ltd and NHPC Ltd for setting up another 1,000MW capacity.
The cabinet will shortly take up the proposals for consideration. This is in addition to state-owned NTPC’s tender for setting up a 1,000MW capacity by using solar cells and modules made in India.
The proposal is WTO compliant as (supposedly) domestic equipment can be used for both defense as well as government’s own requirements. This is why the Defense and PSUs have been roped in, and there are future plans to bring in Indian Railways as well. Some of you might be aware that Brazil has also come out with a scheme to promote solar power by using domestically sourced equipment.
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