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In this episode of Budget Insights, a podcast series from EY India Insights, Raju Kumar, Partner and Tax Leader – Energy sector, EY India, highlights the possible support that Budget 2026 can give to clean energy, green mobility, large-scale energy storage. He adds that a diversified energy mix would include support for renewables and long-term policies options like nuclear to achieve holistic growth.
Key takeaways
Budget 2026 can balance energy security, affordability, and transition through system-level interventions and policy support.
Secure critical minerals supply chains and investing in domestic exploration, recycling, and partnerships is vital for resilient battery storage and electric mobility.
Grid modernization and large-scale energy storage can improve system stability and lower power delivery costs.
Fiscal and policy support like subsidies and incentives are foundational for scaling emerging technologies like green hydrogen and smart grids.
Budget 2026 should focus on strengthening the foundations of India's clean energy ecosystem because balancing energy security, affordability, and transition requires system-level interventions.
Raju Kumar
Partner and Tax Leader – Energy sector, EY India
For your convenience, a full text transcript of this podcast is available on the link below:
Romita Majumdar
Welcome to Budget Insights, a podcast series from EY India Insights, where we discuss key policy developments shaping India’s economic landscape. I’m your host Romita, and in today’s pre-Budget episode, we will explore expectations and priorities ahead of the upcoming Union Budget.
We are pleased to be joined by Raju Kumar, Partner and Tax Leader – Energy sector, EY India. Raju advises companies on tax structuring for cross-border investments, tax-effective global supply chains, income repatriation, incentives, and tax compliance, with a focus on the energy and resources sector.
Today, he will share his perspectives on what the energy sector and taxpayers should watch for in the forthcoming Budget, especially in the context of India’s ongoing energy transition.
Raju, thank you for joining us.
Raju Kumar
Thank you, Romita and welcome to the listeners. I am pleased to be here and share my insights on what the energy sector outlook is likely to be and what support the sector will look forward to for the upcoming year. The energy sector has always been the focus of policy initiatives across the globe. And, therefore, I'm very excited to be talking about this sector in more detail with respect to the upcoming Budget.
Romita Majumdar
Thank you. The first question is, what should Budget 2026 prioritize to balance energy security, affordability, and the clean energy transition?
Raju Kumar
I think Budget 2026 should focus on strengthening the foundations of India's clean energy ecosystem because balancing energy security, affordability, and transition requires system-level interventions. Securing critical minerals supply chains is becoming central to energy security. As India scales battery storage and electric mobility, targeted funding for domestic exploration, recycling and strategic overseas partnerships can reduce import dependance and cost volatility over time.
To move on to clean energy transition, that also depends heavily on the power grids’ ability to absorb renewables reliably. Prioritizing grid modernization and large-scale energy storage can improve system stability, reduce renewable curtailment, and lower the overall cost of power delivery to consumers. Similarly, expanding domestic manufacturing of clean energy technologies across solar, wind, batteries and green hydrogen can also be a good enabler to improve supply resilience, support our ability to scale and strengthen India's industrial base.
A diversified clean energy mix remains important (along with) continued support for solar and wind, complemented by long-term policies options like nuclear can contribute to holistic growth instead of becoming overly reliant on any single source as the demand grows.
Finally, affordability and scale depend on access, finance and policy certainty. Strengthening rooftop and agricultural solar schemes, mobilizing climate finance and providing long-term regulatory clarity will be critical to sustain investment and adoption. Taken together, Budget 2026’s real test will be how it connects supply chains, grades, manufacturing and finance into a single coherent clean energy strategy.
Romita Majumdar
Thank you. The next question is, how important is fiscal and policy support for renewables, storage and emerging energy technologies in sustaining long-term growth?
Raju Kumar
If you look at it really, the fiscal and policy support has given the necessary push for the sector in terms of whether viability gap funding or PLI and therefore fiscal and policy support are foundational for sustaining long-term growth, in renewables, storage and emerging technologies in the energy sector.
If you look at it, while costs for solar and wind energy have decreased, newer technologies like green hydrogen, advanced grid tech and hybrid solutions still require strategic fiscal support through targeted subsidies or tax incentives and stable policy frameworks to achieve cost parity with conventional energy sources and reduce investment risk for attracting private and global capital.
Moving on to the storage technologies, which have been spoken about in the last couple of budgets and industry is quite bullish about, it is really giving a boost to the renewables sector. The government's extension of transmission charge waivers for energy storage projects is an important development towards bringing affordability to the energy ecosystem.
In terms of emerging technologies like green hydrogen, advanced storage chemistry and smart grid solutions, these require clear long-term policy support to develop. Although these technologies address significant decarbonization challenges, they involve higher upfront costs and infrastructure needs, stable policies and fiscal incentives to build investor confidence and support domestic manufacturing. So, a credible, long-term growth strategy for clean energy must combine ambition with robust fiscal backing and policy clarity for renewables and storage to ensure a reliable energy transition.
Romita Majumdar
Thank you. The last question. Do you expect the Budget to provide clearer signals on nuclear energy as part of India's broader clean energy strategy?
Raju Kumar
Yeah, I would think so, because the subject of nuclear energy is increasingly visible in the policy landscape. But it remains a long term priority within India's clean energy transition. The Budget may provide direction and clarity though the trajectory is likely to be evolutionary rather than transformative. Recent policy developments, particularly the Cabinet's decision to allow private sector participation in the nuclear power sector, indicate a commitment to expanding the ecosystem beyond public sector operators.
That said, nuclear energy continues to be a capital-intensive, long-gestation play in the energy mix. While there is growing interest in small modular reactors, these technologies are still at an early stage. So, instead of expecting large-scale deployment announcements, we may expect Budget 2026 to reinforce nuclear strategic and long-term role in India's clean energy transition, with near-term capacity additions driven by other clean energy technologies.
In fact, Budget 2026 may as well prioritize discom reform and system integration over standalone technology initiatives as healthier distribution utilities are essential for scaling even the most advanced technologies.
Romita Majumdar
Thank you, Raju, for sharing your perspectives on the expectations ahead of the Union Budget and the potential implications for taxation in the energy sector. Your insights will help our listeners understand key considerations as we approach the Union Budget.
Thank you to our listeners for tuning into Budget Insights, part of EY India Insights. Stay connected with us for Post-Budget analysis and commentary on how policy changes may impact businesses and individuals.
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