India can implement renewable energy projects at a lower cost than most countries and catch up with China which has taken the lead in the sector, KV Kamath , the president of the New Development Bank — also known as the BRICS bank — said on Sunday.
“In building scale, clearly in terms of manufacturing capacity and projects that are already on the ground, China took the lead. I must say India is catching on,” Kamath told the Hindustan Times in Xiamen.
“The targets that are set up by the (Indian) government are very desirable and indeed in today’s context, it is achievable because of the cost of green today is less, in most cases, than the cost of coal and other fossil fuel (projects),” he said.
Kamath added that India has the advantage of not being at the same stage of development as China is.
“India has advantages. Some ecological imbalances have not yet occurred (in India) because we have not yet grown to a level where we would have caused economic imbalances. If we move to replaceable energy now and take small corrective measures, we can do it at a significantly lower cost than other countries,” he said.
The NBD chief said the value of projects funded by his bank in India could reach $800 million to $1 billion.
“The interesting thing is that in a country like India, we are seeing not only the first set of renewable projects that we are talking of, we are also seeing socially good projects. We are looking at projects (that will give) access to rural areas in terms of roads or water.
“These projects like water projects clearly have elements of ecology — there is a sanitation part built in. Clearly, there are certain things which India needs to get on priority (which are) getting address in projects that are coming to us,” he said.
Kamath said the drop in India’s GDP was “transitional”.
“What is required in the Indian context is that the retail customer, retail consumer to grow. In all our economies, I find that where the driver of growth is.
“Government will continue to invest in infrastructure. It will provide momentum but investment in manufacturing happens out of demand – that demand is driven by the lay consumer,” he said, adding that the “lay consumer is driven by interest rates.”
Kamath explained: “This cycle of interest rates is getting to a level where the lay consumer is happy to buy a home, put things into that home, buy transportation equipment and set the wheels in motion.”
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