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Sector brief 06 of 08

Energy, Renewables & Industrials

Renewable generation, transmission, oil and gas and most mining take 100% FDI on the automatic route; atomic energy stays closed to FDI. Tenders, grid access, power sale agreements and listed equipment decide whether a project gets built.

300.50 GWNon-fossil power capacity on 31 July 2026, over 54% of the installed total (PIB factsheet, Aug 2026)
500 GWNon-fossil capacity target for 2030, the COP26 commitment
100%FDI under the automatic route for renewable energy generation and distribution

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Cover of the IMC brief: Energy, Renewables & Industrials

In this brief

Everything in this sector brief

11 pages, from the market case to the set-up roadmap and every incentive with its status.

Overview

Energy, renewables and industrials

Renewable generation, transmission, oil and gas and most mining take 100% FDI on the automatic route; atomic energy stays closed to FDI. Tenders, grid access, power sale agreements and listed equipment decide whether a project gets built.

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Recent investments

Recent foreign investments in Indian energy

Global infrastructure investors are building Indian renewable platforms. Five transactions announced between September 2024 and July 2026, with investor, home country, asset, size, date and the source that reported each.

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FDI rules

FDI rules for energy, renewables and mining

Renewables, oil and gas and mining allow 100% FDI on the automatic route; power exchanges and PSU refining are capped at 49%; atomic energy stays prohibited despite the SHANTI Act 2025. Investors from land-border countries need government approval above 10%.

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Regulators

Regulators and registrations for energy projects

Projects need a tender award, grid access and listed equipment before supply. No standard timelines apply; timing depends on the tender schedule, land and grid availability. Seven approvals, who grants them and when each is needed.

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Central incentives

Central incentives for energy and renewables

Manufacturing and hydrogen incentives are awarded in competitive rounds; storage, offshore wind and rooftop solar receive capital support; waivers, consumption mandates and new missions support offtake. Eighteen schemes with their printed status.

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State incentives

State incentives for energy and clean-tech plants

States add duty waivers, land and capital subsidies to central support. Rajasthan and Uttar Pradesh rows come from clean-energy policies; Tamil Nadu, Maharashtra and Karnataka rows are general industrial policies, shown for equipment manufacturing.

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Tax and zones

Tax, customs and zones for energy investors

GST on clean-energy equipment fell to 5% from 22 September 2025 and Budget 2026-27 adds duty relief. The 15% regime is closed, so new generation and equipment companies typically pay 25.168%. ECB limits rose in February 2026.

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Set-up roadmap

Set-up roadmap for energy projects

From entry decision to commercial operation of a utility-scale project: nine steps for a developer bidding in central or state tenders, how C&I and equipment projects differ, and the entity and incorporation steps that come first.

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What to watch

What to watch in Indian energy projects

Grid access, contract signing and equipment rules drive most project risk. Six compliance watch-outs for renewable developers and equipment makers, with what each means for a bid or a plant.

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Recent changes

Recent changes in energy and renewables

What changed since 2025 for foreign investors in Indian renewables, storage, nuclear and offshore energy, with the date, the effect on investors and the source for each entry.

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Sources

Sources for energy and renewables

The full reference list behind this hub, grouped as in the sector brief. Figures and statuses across these pages are as of 1 October 2026 and are quoted from the sources below.

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Updates

Recent changes

All changes
  1. ECB limits raised and cost ceiling removed for three-year-plus loansFDI policy · RBI Notification FEMA 3(R)(5)/2026-RB, 9 Feb 2026
    medium impact
  2. SHANTI Act opens nuclear power to licensed Indian companies; FDI still barredSector rules · PIB (DAE), 1 Apr 2026; RBI Master Direction, Jun 2026
    low impact
  3. high impact

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