India aims for 500 GW of renewable energy installed capacity by 2030 (Representational)
Keeping aside the investor's apprehensions of weak policies under Narendra Modi's third term, the world rating agency, Moody's has expressed confidence in the growth trajectory of India's power sector.
Moody's said renewable energy and electricity transmission will continue to drive investments in India's power sector over the next six to seven years.
The rating agency expected that the power demand in the country would grow by 5 to 6 per cent per annum over this period.
The coal-based generation capacity additions are likely to supplement baseload requirements, it added.
The renewable energy companies largely funded by debt, will lead to high financial leverage over the next three years, it added.
Moody's said the industry is benefiting from consistent government regulations and policies that support the shift to renewable energy, which helps power companies to continue their transition despite the high debt levels.
Highlighting the importance of the renewable energy sector, the global agency said that the country needs to add around 44 Gigawatt (GW) to fulfil its target of 500 GW of renewable energy capacity by 2030.
And to meet these targets it will require $190 billion to $215 billion of investment over the next seven years. It is estimated that another $150 billion to 170 billion of investment will be required for electricity transmission and distribution, and energy storage to cater to the incremental renewable energy capacity.
Moody's highlighted that the strong policy support has helped India increase the share of renewable energy in its power capacity mix to around 43 per cent in fiscal 2023-2024.
"Continued policy support will help India make significant progress toward its 2030 transition targets and 2070 net-zero targets, The global rating agency added.
India aims for 500 GW of renewable energy installed capacity by 2030. the country has set the target to produce 5 million tonnes of green hydrogen by 2030, supported by 125 GW of renewable energy capacity.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)