Union Budget 2025-26: EV Startups to Thrive with New Policy Extensions and Tax Benefits

Finance Minister Nirmala Sitharaman has announced significant tax exemptions to promote the production of lithium batteries and related sectors under Union Budget 2025-26 with a clear focus on fiscal responsibility and economic growth.

The Union Budget reflects a strategic balance between investment and financial prudence, aiming to sustain the country’s economic momentum while addressing key development priorities. With total receipts (excluding borrowings) at INR 34.96 lakh crore and total expenditure projected at INR 50.65 lakh crore, the government is ensuring targeted spending to stimulate industries and infrastructure. The fiscal deficit, estimated at 4.4 percent of GDP, signals the government’s commitment to maintaining financial stability while fostering growth.

Clean Tech and Mining Reforms

In the recent budget announcement, the government is prioritizing clean technology to drive sustainable manufacturing, focusing on domestic production of solar PV cells, EV batteries, wind turbines, and high-voltage transmission equipment. Mining reforms will introduce a State Mining Index, promoting best practices among states while ensuring efficient resource management. Additionally, a policy for recovering critical minerals from tailings will help maximize mineral use, securing essential materials for industries like electronics and renewable energy.

Introducing National Manufacturing Mission as its core vision, the government believes that it will boost small, medium, and large industries with policy support and execution roadmaps, reinforcing India’s position as a global manufacturing hub. This initiative will provide a structured governance framework, ensuring collaboration between central ministries and state governments to optimize industrial growth. The mission also encourages innovation in electrolyzers and grid-scale batteries to support renewable energy infrastructure.

Critical Minerals & Lithium-Ion Batteries

The government continues to strengthen domestic manufacturing by fully exempting cobalt powder, lithium-ion battery scrap, lead, zinc, and 12 other critical minerals from import duties. These exemptions aim to reduce costs and encourage local processing industries, particularly benefiting MSMEs involved in mineral refining.

Additionally, 35 capital goods for EV battery production and 28 capital goods for mobile phone battery manufacturing are now exempt from duties, promoting large-scale domestic production and reducing dependence on imports.

Social Security for Gig Workers in E-Commerce

Recognizing the contributions of gig workers in the digital economy, the government has proposed to provide identity cards and register them on the e-Shram portal. Additionally, nearly one crore gig workers will now receive healthcare benefits under PM Jan Arogya Yojana, ensuring their well-being and financial security.

R&D Investment

To drive private-sector-led research and development, an INR 20,000 crore allocation has been earmarked. This fund will support breakthrough innovations and enhance India’s global competitiveness in science and technology.

Auto Industry’s Take on Union Budget 2025

Sharing their perspective on the recent budget announcement, Shradha Suri Marwah, President, ACMA, said, "The Union Budget 2025-26 is forward-looking and growth-centric, reinforcing the government’s commitment to strengthening India’s manufacturing sector and driving the transition to cleaner mobility solutions. The focus on MSMEs, innovation, exports and supply chain resilience will provide a strong impetus to the auto component industry. Further, the proposals for personal Income Tax will put more money in the hands of people thus fuelling consumption leading to economic growth."

Rajat Verma, Founder & CEO - Lohum, Chair - India Reuse & Recycling Council (IRRC), IESA said, “The 2025 budget marks a watershed moment in India's journey toward clean energy sovereignty and circular economy leadership. The government's strategic vision for domestic manufacturing and critical minerals recycling demonstrates remarkable foresight in securing our sustainable future. The elimination of import duties on lithium-ion battery scrap, cobalt powder, and an array of critical mineral wastes unlocks unprecedented opportunities. Coupled with the duty exemption expansion to 63 additional capital goods for EV and mobile battery production, this creates a robust foundation for India's manufacturing renaissance.”

“The landmark ₹20,000 crore investment in private-sector R&D for emerging technologies signals a transformative shift in building a sustainable critical minerals ecosystem. At Lohum, where innovation drives our mission, we recognize this as a catalyst that will revolutionize India's technological capabilities. The introduction of a comprehensive policy for critical minerals recovery from tailing epitomizes the government's commitment to Atmanirbhar Bharat through circular innovation. This strategic initiative, alongside the National Critical Mineral Mission and an Economic Survey that deeply examines climate adaptation, charts a clear course toward India's energy independence. We extend our appreciation to the government and stakeholders who have orchestrated these visionary reforms. This demonstrated commitment to excellence positions India as a global leader in energy transition and climate action. At Lohum, we stand ready to amplify this momentum and drive India's sustainable future forward,” added Verma.
 
Nirmal K Minda, Chairman & Managing Director, Uno Minda shared, "We welcome the Union Budget 2025-26 for its forward-looking and holistic initiatives aimed at sustainable growth across key sectors. The fiscal deficit target of 4.4% reflects a commitment to fiscal consolidation while ensuring critical investments in infrastructure and development projects. This targeted approach not only maintains macroeconomic stability but also fosters an environment conducive to long-term growth. We particularly appreciate the measures designed to boost job creation and strengthen the manufacturing sector. The introduction of the National Manufacturing Mission, focused on enhancing 'Make in India,' is a significant step toward fostering growth and self-reliance. By providing policy support across industries, this initiative will accelerate domestic manufacturing and reinforce India's position as a global manufacturing hub. The government’s commitment to developing domestic manufacturing capacity by identifying key sectors and supply chains will enhance self-reliance in critical industries.”

“Moreover, the ease of doing business initiatives announced in the budget will simplify regulatory frameworks, creating a more business-friendly environment that promotes growth and innovation in manufacturing. These steps will undoubtedly improve India's competitiveness in the global market. The Clean Tech Mission is another positive development, offering a much-needed boost to clean tech manufacturing. The focus on solar PV, electric vehicles (EVs), and batteries aligns well with our vision for a sustainable future. Strengthening the clean technology ecosystem will accelerate the transition toward greener mobility and manufacturing. Furthermore, the government’s emphasis on manufacturing EV batteries and EV components, will significantly enhance domestic manufacturing capacities and reduce import dependence. Efforts to localise key EV components such as batteries, motors, and controllers will also help lower upfront costs, making EVs more accessible to consumers and strengthening India's EV ecosystem. We are also encouraged by the emphasis on increasing women's participation in the workforce. Initiatives such as setting up hostels and organizing women-specific skilling programs are crucial for creating a more inclusive manufacturing sector. The establishment of five National Centres of Excellence for Skilling will further strengthen India's workforce, ensuring we remain competitive in the evolving global landscape. Overall, we are confident that these measures will drive sustainable and inclusive growth, positioning India as a global manufacturing hub. We look forward to engaging with the government on these initiatives, as empowering youth and increasing women's participation have always been our key priorities," added Minda.

Rohit Saboo, President & CEO, NBC Bearings said, “We appreciate the Finance Minister's highly growth-oriented budget, with its clear focus on enhancing self-reliance (Atmanirbharta) in the manufacturing sector, driving the Atmanirbhar Bharat vision forward. The introduction of the National Manufacturing Mission across industries of all sizes, underpinned by robust policy measures, represents a crucial step towards strengthening the "Make in India" initiative. This will undoubtedly boost domestic manufacturing capacity and reduce our dependence on imports, particularly for critical components used in electric vehicles (EVs), batteries, and related parts. The enhanced credit guarantee cover and investment in MSME classification will provide essential financial support to the more than 10 million registered MSMEs, which employ 75 million individuals. This strengthens their crucial role in establishing India as a global manufacturing powerhouse and contributes significantly to the Atmanirbhar Bharat mission. Overall, this budget demonstrates a progressive vision, prioritising sustainable growth within the manufacturing sector and equipping our workforce for the future. We are optimistic that these initiatives will deliver tangible results for the manufacturing industry and contribute significantly to the nation's overall economic growth, furthering the goals of Atmanirbhar Bharat.”

Uday Narang, Founder and Chairman, Omega Seiki Pvt. Ltd., remarked, "The Union Budget 2025-26 has taken a commendable step towards strengthening India’s manufacturing ecosystem by removing the Basic Customs Duty (BCD) on critical materials such as cobalt, lithium-ion battery scrap, and lead. These materials are essential for the production of lithium batteries, which are the backbone of the electric vehicle and clean energy industries. By eliminating these duties, the government is not only reducing the cost of production for manufacturers but also accelerating the transition towards more affordable and sustainable technologies.This bold move will help make electric vehicles and electronics more affordable for consumers while fostering the growth of domestic industries. With a focus on local manufacturing, the government is laying the foundation for India to become a global leader in battery production and renewable energy technologies, while significantly reducing dependence on imports. At Omega Seiki, we are excited about the future prospects of this policy and its potential to drive innovation and sustainability in the sector.

On skill development, Narang said, “The announcement of three Centres of Excellence in Artificial Intelligence with a ₹500 crore allocation in the Union Budget 2025-26 is a remarkable initiative that will significantly boost India’s technological and educational landscape. This focus on AI research and its application in education will empower the next generation with cutting-edge skills, preparing them for the challenges of tomorrow’s workforce. At Omega Seiki, we strongly believe that this forward-thinking investment in skill development will drive innovation across sectors, particularly in industries like EVs, clean energy, and electronics, paving the way for a digitally proficient and globally competitive India."

Yogesh Bhatia, CEO and MD, LML, expressed, "The National Manufacturing Mission marks a transformative step for India’s industrial ambitions, with a sharp focus on clean-tech sectors like EV batteries, solar cells, and wind turbines. By exempting Basic Customs Duty on critical minerals and expanding the list of goods for EV and mobile battery manufacturing, the government has delivered a cost-cutting, value-adding masterstroke. These measures will bolster domestic production, enhance supply chain resilience, and position India as a global clean-tech hub. The introduction of a voluntary declaration provision further underscores an industry-friendly approach, easing compliance and boosting the ease of doing business. For manufacturers, this is a golden opportunity to invest in sustainable technologies, reduce import dependency, and drive innovation. With these reforms, India is not just strengthening its ‘Make in India’ initiative but also accelerating its journey towards sustainable manufacturing and global competitiveness. The clean-tech sector, in particular, stands to gain immensely, paving the way for a greener, self-reliant industrial future."

Sharing his views on India’s EV sector, Pratik Kamdar, CEO & Co-Founder, Neuron Energy, added, "The Union Budget 2025's announcements for the EV and auto sectors center on raising the sector's value and demand, which is a positive move. India's effort to produce clean tech energy will be accelerated as a result. A significant boost to the EV battery industry; the National Manufacturing Mission's coverage of MSME represents a step forward in bolstering domestic EV battery production. The FM's plan to exclude lithium-ion batteries from basic customs duty will even increase the cost-effectiveness and flexibility of the supply chain. More EV adoption will also be supported by stronger energy infrastructure, particularly for EV charging stations, which will be fueled by power sector reforms and state incentives. Viksit Bharat's focus on nuclear energy and the exemption of 35 capital goods for the production of EV batteries show a strategic vision for a sustainable future. It will boost the industry further and grow the battery and EV auto industries. Together, these programs create an atmosphere that is conducive to clean-tech innovation, job growth, and a more robust EV ecosystem."

“The Union Budget’s emphasis on MSMEs and startups is a welcome move, acknowledging them as the second engine of growth for India. MSMEs play a crucial role in our economy, contributing to 45% of exports, and the introduction of customized credit cards for micro-enterprises will provide much-needed financial flexibility. At Folks Motor, we recognize that easy access to credit is a game-changer, especially in the EV industry, where small businesses are integral to the supply chain, charging infrastructure, and localized manufacturing. The government’s additional ₹10,000 crore contribution to the Fund of Funds for Startups further strengthens India's commitment to fostering entrepreneurship. As an xEV company, we see this as a step toward accelerating innovation in clean mobility, enabling startups to develop next-generation EV technology, battery solutions, and smart charging infrastructure. India’s transition to sustainable transportation requires strong policy backing, and this budget has laid the foundation for inclusive growth. By empowering MSMEs and startups with financial support, the government is not just driving economic growth but also paving the way for a more robust EV ecosystem. At Folks Motor, we remain committed to driving India’s xEV future with sustainable and accessible mobility solutions,” said Nikhil Khurana, MD & CEO, Folks Motor (P.) Ltd.

Yatin Gupte, Chairman & Managing Director, Wardwizard Innovations & Mobility Ltd., said, "We welcome the policies stated in Union Budget 2025-26 by the Hon’ble Finance Minister, which gives a strong push towards EV adoption, accelerating the development India’s electric vehicle ecosystem. The reduction in customs duty on lithium and other important raw materials will significantly lower input costs for lithium-ion battery manufacturing, making EVs more affordable to consumers while boosting domestic production. The introduction of a national manufacturing mission for clean tech industries is another commendable move. By strengthening the ecosystem for EV batteries, motors, and controllers, this initiative will accelerate India’s transition to sustainable transportation. The recognition of MSMEs as the ‘2nd engine’ of economic growth in the Union Budget 2025 will boost sectoral confidence. The fiscal policies stated to support MSMEs will have a multiplier effect on various sectors, including accelerating India’s e-mobility revolution. We are confident that the expanded tax bracket will enhance the purchasing power of the middle class, which will positively impact EV industry in India."

Prashant Vashishtha, Chairman and Managing Director of Sokudo Electric India discussed, “The Budget 2025-26 is a significant step toward strengthening India's startup ecosystem and accelerating the growth of the electric vehicle industry. The government’s emphasis on clean-tech manufacturing, deep-tech funding, and expanding the Credit Guarantee Scheme is a strong signal of its commitment to fostering innovation and self-reliance. For EV startups like Sokudo Electric, the push for domestic battery production and the development of a robust infrastructure are much-needed moves. These initiatives will not only reduce our dependence on imports but also create a more sustainable and efficient supply chain. The focus on ease of doing business, through measures like the Jan Vishwas Bill 2.0 and streamlined regulatory frameworks, will make it easier for startups to scale, attract investments, and contribute to India’s economic growth.”

Speaking on India’s tax reforms announced in Union Budget 2025-26, Harpreet Oberoi, Partner at Jotwani Associates shared, "Multiple tax reform measures within the Union Budget 2025-26 seek to both increase economic growth and ease business operations throughout India. Under the new tax system, all people earning less than ₹12 lakh per year will not need to pay income tax. The tax exemption policy for middle-class citizens will generate increased financial reserves to boost economic activity in all sectors. Welcoming the new TDS and TCS relaxation policies will help businesses, together with individuals, reduce their tax compliance responsibilities. Simplification of tax compliance takes place when TDS rates get rationalized and thresholds are adjusted together with interest deduction limits for senior citizens and rental income TDS exemption limits are increased. This creates an efficient, business-friendly tax structure. Taxpayers will experience simpler financial operations because the government has eliminated TCS on education loan remittances and optimized international transactions tax rules. The government should formally eliminate specific tax provisions from criminal penalties while simultaneously making tax legislation more straightforward. The reforms eliminate unnecessary penalties and legal hurdles that develop and improve relationships between taxpayers and the government based on transparency and trust. Startups alongside MSMEs will reduce their regulatory exposure through minimized litigation risks, thus they can pursue expansion opportunities without anxiety about uneconomical monitoring.”

Ashish Gupta, Brand Director, Volkswagen India said, "Today’s Union Budget 2025 presents a forward-thinking roadmap for strengthening India’s manufacturing ecosystem, with a clear emphasis on clean technology, skill development, and infrastructure growth. By prioritizing these areas, along with manufacturing, India is advancing toward a circular economy—where investments, innovation, and sustainable practices drive long-term growth. This vision is further reinforced with significant initiatives for the automotive industry, ensuring a more self-reliant and innovative future. The exemption of Basic Customs Duty (BCD) on cobalt powder, lithium-ion battery waste, lead, zinc, and other critical minerals will strengthen India’s battery ecosystem. While 35 additional capital goods added to the exemption list for EV battery manufacturing – will boost domestic production and reduce import dependency. Establishment of five National Centres of Excellence will upskill talent for future-ready automotive innovation and is a crucial step in shaping India’s clean tech ecosystem. I believe, Infrastructure growth through Public-private partnerships and capital expenditure incentives - will pave the way for India to become a globally competitive manufacturing hub. Even, tax exemptions for individuals earning up to ₹12 lakh annually - will increase disposable income, thereby enhancing purchasing power and drive greater demand in the auto sector as well. At Volkswagen India, we are optimistic that these measures will further reinforce India’s position as an automotive manufacturing hub."

Dhananjaya Bhardwaj, CEO and Founder, ParkMate, said, “The Budget 2025-26 is a big win for startups and a step in the right direction for businesses striving to innovate and scale in India. As a young company in the mobility-tech space, we at ParkMate are particularly encouraged by the government’s commitment to fostering entrepreneurship, improving ease of doing business, and strengthening digital infrastructure. The introduction of the Jan Vishwas Bill 2.0, faster approvals for mergers, and an investment-friendly index set to launch in 2025 all signal a future where startups can grow with fewer regulatory roadblocks and more institutional support. For companies like ours, which are working to solve real-world mobility challenges, the government’s focus on urban infrastructure and smart city development is particularly exciting.”

“The ₹1 lakh crore Urban Challenge Fund and ₹1.5 lakh crore interest-free loans for capital expenditure are massive moves that will lead to better-planned cities, improved traffic management, and increased adoption of tech-driven mobility solutions. Beyond infrastructure, the expansion of funding options for startups—through a higher credit guarantee cap and deep-tech investment—shows a clear push toward innovation. This budget has set the stage for emerging companies to access capital more efficiently, reduce dependency on traditional funding sources, and focus on scaling their solutions. The government's trust-based approach, where scrutiny comes after trust, will also go a long way in easing compliance and creating a more startup-friendly environment. At ParkMate, we strongly believe that technology can reshape urban mobility, and with the right policies, we can build smarter, more efficient cities. This budget lays the groundwork for startups like ours to collaborate with the government, leverage digital infrastructure, and be a part of India’s growth story. We’re excited about the road ahead and look forward to driving meaningful change in the way people move and park in our cities,” discussed Bhardwaj.

Vikram Handa, MD, Epsilon Advanced Materials, commented, “The Union Budget 2025's clear focus on clean technology, particularly the launch of the Clean Tech Mission, is incredibly encouraging. The emphasis on EVs and battery technologies aligns perfectly with India's ambition to create a sustainable mobility ecosystem. At Epsilon Advanced Materials, we are especially excited about the initiatives to boost domestic manufacturing of EV batteries and components. The exemption of crucial materials like cobalt powder, lithium-ion battery scrap, lead, zinc, and 12 other critical minerals from Basic Customs Duty is a significant step. Further incentivizing domestic production is the inclusion of 35 additional goods for EV battery manufacturing in the exempted capital goods list, which will help reduce reliance on imports. This provides a powerful impetus for the industry to invest in expanding domestic capabilities. The budget's overall thrust towards fostering a robust clean tech ecosystem is highly commendable and positions India for leadership in the global clean energy transition. We are ready to play a key role in this exciting growth story.”

Dr. Nishanth Dongari, Founder and MD, PURE EV, explained, "The Union Budget 2025 is a growth-oriented and forward-looking blueprint that strengthens India's commitment to clean technology and energy self-reliance. The exemption of lithium-ion battery capital goods, along with 35 new exemptions for EV battery manufacturing, will drive faster localization and technological advancement, furthering India’s push towards becoming a global hub for electric mobility. The National Manufacturing Mission’s emphasis on clean tech manufacturing, including EV batteries, motors, controllers, and grid-scale storage, will enhance domestic value addition and build a robust ecosystem for sustainable mobility. The focus on Grid Scale (ESS) Batteries is particularly significant as it will support the growth of solar and wind energy while accelerating the much-needed infrastructure for EVs. The ₹10,000 crore Fund of Funds for Startups is also a welcome step that will provide vital capital to entrepreneurs at various stages, reducing dependence on foreign funding and encouraging homegrown innovation. Also, the Nuclear Energy Mission, with its 100 GW targets by 2047 and ₹20,000 crore allocation for Small Modular Reactors (SMRs), further reinforces India’s clean energy ambitions.”

“Additionally, the introduction of the ‘Grameen Credit Score’ framework for rural borrowers is a transformative step that will improve access to finance for rural areas, thus contributing significantly to the growth of the rural economy. This move will empower self-help groups (SHGs) and rural borrowers by making loans and financial services more accessible. This budget lays a strong foundation for a self-reliant, green, and innovation-driven India,” added Dr. Dongari.

Govind Sankaranarayanan, Co-founder & COO, Ecofy, commented, “The announcement of the National Manufacturing Mission to support clean tech manufacturing is a significant step toward accelerating India’s green transition. By boosting domestic production of EV batteries and solar panels, this initiative will reduce reliance on imports, while also driving innovation and create sustainable jobs. At Ecofy, we are committed to enabling a greener future, and this move aligns perfectly with our mission to support clean energy solutions that empower businesses and individuals. We applaud the government’s vision for fostering a self-reliant and sustainable clean tech ecosystem in India."

Gaurav Dolwani, CEO, LICO Materials clarified, “The Union Budget 2025's decision to exempt cobalt powder, lithium-ion battery scrap, and other critical minerals from Basic Customs Duty (BCD), along with the reduction in import duty for lithium scrap, is a significant step toward strengthening India’s battery recycling ecosystem and fostering a sustainable circular economy. The inclusion of 35 capital goods related to EV battery manufacturing will further accelerate domestic lithium-ion battery production, reducing reliance on imports and enhancing India's self-sufficiency in critical mineral processing. Integrating these advancements into second-life battery applications will play a crucial role in expanding India's EV battery ecosystem, driving innovation, and supporting the country's Atmanirbhar Bharat vision. At LICO Materials, we remain committed to pioneering sustainable solutions by recycling lithium-ion batteries and recovering critical raw materials, contributing to a cleaner, more resilient, and self-reliant energy future for India.”

Bharath Aitha, Vice President of Marketing, eInfochips, said, "The Union Budget 2025-2026 is a forward-looking blueprint that aligns closely with India’s aspirations to become a global technology and innovation powerhouse. We are particularly encouraged by the government’s emphasis on clean tech manufacturing, R&D investments, and skill development, which are critical to driving sustainable growth and technological self-reliance. The allocation of ₹20,000 crore for private sector-driven R&D and the proposed Deep Tech Fund of Funds are significant steps toward fostering innovation in emerging technologies like semiconductors, AI, and quantum computing. These initiatives, coupled with the focus on green energy and sustainable manufacturing, will not only accelerate India’s transition to a low-carbon economy but also position the country as a leader in global green-tech innovation. Additionally, the budget’s focus on skilling and digital infrastructure underscores the importance of creating a future-ready workforce, especially in Tier 2 and Tier 3 cities. By bridging the digital divide and empowering underserved sectors through AI and IoT-driven solutions, this budget lays the foundation for inclusive growth and equitable access to opportunities.”

“At eInfochips, we are excited to contribute to this transformative journey by delivering innovative solutions that align with national priorities and global aspirations. This budget is a testament to India’s commitment to building a resilient, inclusive, and future-ready economy, and we look forward to playing a pivotal role in this evolution," Aitha added.

Anagh Ojha, Co-founder & CTO at Urja Mobility commented, “Budget 2025 takes a significant step toward strengthening India’s EV and energy storage ecosystem. The introduction of the Critical Mineral Mission aims to enhance domestic production, overseas acquisition, and recycling of essential minerals like lithium, cobalt, and nickel—crucial for battery manufacturing. Additionally, the government has removed customs duties on 25 critical minerals, including lithium and copper, reducing import costs for key raw materials. This move is expected to boost local battery manufacturing, reduce reliance on imports, and make EVs more affordable. The continued focus on PLI schemes and incentives for battery storage and EV production further signals the government’s commitment to clean mobility. However, successful implementation will depend on execution speed, policy clarity, and ensuring a stable supply chain. For startups and businesses in the EV and energy storage space, these measures present new opportunities but also demand agility in adapting to policy shifts. If complemented by financing solutions and infrastructure expansion, India can accelerate its transition to sustainable mobility. Overall, Budget 2025 lays a strong foundation for India's energy future, but industry collaboration and effective execution will be key to unlocking its full potential."

Dev Arora, Founder & CEO at Alt Mobility said, “Budget 2025 is a game-changing moment for the electric vehicle (EV) sector, particularly with the introduction of BCD (Basic Customs Duty) cuts on materials required for Li-Ion batteries. This will significantly lower production costs and help accelerate the growth of a zero-emission vehicle ecosystem in India. The full exemption of customs duty on 35 capital goods for EV manufacturing, combined with the ₹10,000 crore Clean Tech Mission, is set to drive innovation and create a self-sustaining, local ecosystem for EV batteries, motors, and controllers. This will reduce our reliance on imports and make cutting-edge, sustainable technology more accessible to manufacturers, paving the way for a truly green future. The budget also shines a spotlight on MSMEs, particularly in the auto component sector, with easier credit access and a doubled credit guarantee cover to ₹10 crore. This will empower smaller component manufacturers to scale up and contribute to India’s clean mobility transition. At Alt, we are excited about the government’s strategic focus on clean tech and local manufacturing, which not only reduces costs but also sets India on a trajectory to become a global leader in EV and clean energy solutions, fostering long-term growth and a cleaner, greener future."

Niranjan Nayak, MD, Delta Electronics India, shared, "The Union Budget 2025-26 lays down a strong foundation for India to transition towards becoming a sustainable, technology-driven, and self-reliant economy. The emphasis of the government on green energy, EV infrastructure, AI-led innovation, and digital transformation closely resonates with Delta's aim to deliver energy-efficient, smart solutions that power the future.
This would place India on further accelerated net-zero emission paths and spur technological leadership for the country simultaneously. Higher penetration of clean mobility will be facilitated through investments in modernising smart grids and EV charging infrastructure. Delta is placed to help since it leads the market for an EV charging and power solution. The PLI incentives for R&D and manufacturing under the scheme will further cement India's position as a world manufacturing hub."

Kaustubh Dhonde, Founder & CEO, AutoNxt Automation said, “The FY25 budget provides a transformative opportunity for the automotive and auto components sector, with the allocation rising over sevenfold to INR 3,500 crore from INR 483.7 crore in FY24. This substantial increase is a game-changer for the sector, ensuring the continued growth and modernization of auto manufacturing, including key innovations in electric vehicles. With a 36% rise in allocations for electronics manufacturing to Rs 6,125 crore and a 72% surge for drone manufacturing to INR 57 crore, the focus on technological advancements is clear. For AutoNxT, this budget opens up a significant advantage in making electric tractors more affordable for farmers. As the gap between diesel tractor prices and electric tractor prices continues to narrow, the proposition for farmers to switch to electric tractors becomes even clearer. This shift not only promotes sustainable farming practices but also positions AutoNxT’s automation solutions as key enablers in helping farmers transition to more efficient, cost-effective, and environmentally friendly machinery. This budget is truly one of the best budgets for the country building class of India while focusing on the needs of the developed India!”

Anupam Kumar, Co-Founder and CEO, MiniMines Cleantech Solutions explained, "The Union Budget 2025-26 marks a transformative step toward a cleaner, greener future, and for companies like MiniMines, it presents a wealth of opportunities. With the government’s strong push for clean energy, the demand for critical materials such as lithium-ion is set to rise. The Finance Minister’s proposal to provide a full exemption of Basic Customs Duty (BCD) on cobalt powder, lithium-ion battery waste, scrap, and 12 other critical minerals is a major boost for the sector. This move will secure the availability of these essential materials for domestic manufacturing. Additionally, the customs duty reduction on lithium batteries will drive increased consumption, further benefiting the battery recycling industry. The reduction of BCD from 5% to 2.5% is expected to accelerate EV adoption, creating a ripple effect that will increase the demand for battery recycling and rare metal recovery. Furthermore, the tax exemption on cobalt powder will boost the sales and adoption of cobalt-based battery chemistries, opening new avenues for growth in energy storage and mobility.”

"The establishment of a new Fund of Funds (FoF) with an additional ₹10,000 crore and an expanded scope is a welcome move. The initial ₹10,000 crore FoF, managed by SIDBI—of which Cactus Partners has also been a beneficiary—has been a major catalyst for India’s startup ecosystem, significantly contributing to its vibrancy by helping mobilize ₹91,000 crore for Indian AIFs. The exploration of a deep-tech Fund of Funds is also a positive step and will be crucial in driving cutting-edge innovation in India. Additionally, the provision of term loans of up to ₹2 crore for first-time entrepreneurs from certain sections of society, including women, will further encourage entrepreneurship. The increased credit guarantee cover, along with a reduced guarantee fee for startups and MSMEs, will enhance much-needed access to credit. Cleantech and electronics manufacturing have been visibly prioritized in this budget. The exemption of customs duty on 12 additional critical minerals, including lithium-ion battery scrap, will support India’s recycling and minerals processing industry. Similarly, duty exemptions on incremental capital goods for EV battery and mobile phone battery manufacturing will incentivize domestic production and provide a boost to cleantech startups. The stated commitment to supporting the manufacturing of solar cells, EV batteries, and electrolyzers is another positive move. Moreover, there appears to be a clear intent to reduce regulatory compliance for businesses, including startups. Overall, this budget is a step in the right direction toward strengthening the startup ecosystem," added, Amit Sharma, General Partner, Cactus Partners.

Hari Kiran, Co-Founder & COO at eBikeGo said, “The budget presents a promising future for the automotive sector, especially for MSMEs, by addressing critical pain points such as GST rates, import duties on components, and providing key incentives for electric vehicle adoption. The allocation for infrastructure development, particularly in roads and transportation, is bound to boost automotive demand. For MSMEs, which are at the heart of the component manufacturing ecosystem, the provisions for working capital support, technology upgradation, and easier credit access are vital. These measures will not only ensure the survival of these businesses but also drive their growth, fostering innovation and sustainability in the sector.”

Ashok Vashist, Founder and CEO, WTiCabs said, "The expansion of regional connectivity under the UDAN scheme, with 120 new destinations, presents a significant opportunity for WTi Cabs/people mobility Industry to enhance its airport transfers, intercity travel, and last-mile connectivity. Simultaneously, customs duty adjustments supporting EV manufacturing—including exemptions on 35 additional capital goods—will lead to improved technology and lower vehicle acquisition costs. These initiatives will further strengthen WTi’s/ people mobility industries sustainability goals by enabling a smoother transition to electric mobility while leveraging solar-powered EV charging infrastructure, ensuring an eco-friendly and cost-effective transportation network."

Samrath Singh Kochar, Founder and CEO, Trontek added, “The Union Budget 2025 takes a forward-looking approach, emphasizing growth, innovation, and sustainability. By prioritizing infrastructure, technology, and clean energy, the government is laying the groundwork for long-term economic resilience. Enhanced support for MSMEs and a stronger push for green initiatives reflect a commitment to fostering self-reliance and competitiveness in a rapidly evolving global landscape. A clear focus on strengthening domestic manufacturing, promoting technological advancements, and accelerating the energy transition signals India’s intent to lead in critical sectors. The budget also highlights the importance of sustainable development, ensuring that economic progress aligns with environmental responsibility. With these strategic initiatives, India is well-positioned to drive innovation, create new opportunities, and build a more resilient future.”

Sunjay J Kapur, Chairman, Sona Comstar & Deputy Chairman, CII Northern Region said, “The Union Budget 2025 lays a strong foundation for sustainable urban growth, infrastructure modernisation and a thriving investment climate. The National Manufacturing Mission under Make in India will create a robust framework for industries across solar PV, electrolysers, and grid-scale batteries. The expanded ₹10,000 crore Fund of Funds will provide a vital boost to startups, driving innovation and entrepreneurship. The ₹1 lakh crore Urban Challenge Fund and enhanced infrastructure support will catalyse economic activity and improve liveability in cities. Initiatives like Atal Tinkering Labs, National Centres of Excellence, and IIT expansion will equip India’s youth with future-ready skills. Exemptions on basic customs duty for EV components and critical minerals, along with a model Bilateral Investment Treaty, reinforce India’s commitment to self-reliance and global competitiveness. Overall, this budget marks a decisive step towards positioning India as a global powerhouse in manufacturing, mobility, and clean technology.”

H S Bhatia, Managing Director, Daewoo India shared, "The budget announcements are a significant boost to India's growth story. The tax bonanza for the middle class, with zero income tax liability for those with annual income up to INR 12 lakh, will increase disposable income and drive consumption. The exemption of lithium batteries from the Basic Custom Duty will give a fillip to the electric vehicle industry and encourage sustainable development. The government's emphasis on education and innovation, with initiatives like 50,000 Atal Tinkering Labs and IIT expansion, will drive India's innovation boom and create a skilled workforce. These initiatives will have a positive impact on the economy and society, and we look forward to contributing to this growth story."

Samkit Shah, Co-Founder, Jitendra EV said, “The National Manufacturing Mission can provide India with numerous advantages in terms of economic growth, environmental sustainability, and energy independence. However, challenges like high initial investment, infrastructure requirements, and competition from global players will need to be addressed. Strategic planning, investment in technology, and a focus on skill development will be crucial for the mission's success. By supporting the manufacturing of solar cells and EV batteries, the mission aligns with India’s clean energy goals. It can help reduce dependence on imported fossil fuels and boost the use of renewable energy. The establishment of manufacturing facilities for clean tech products will generate employment in both production and research & development (R&D) sectors. Additionally, there will be opportunities to train and upskill workers, benefiting the local workforce. The focus on local production of high-tech products like EV batteries and solar equipment will reduce India’s dependency on foreign imports, strengthening its manufacturing sector. This can also improve India's trade balance by reducing imports. Promoting local manufacturing of advanced technology products (such as solar panels, EV batteries, and high-voltage transmission equipment) could lead to technological advancements, innovation, and knowledge transfer within the country. The mission can make India an attractive destination for global clean tech investments, especially in the electric vehicle and renewable energy sectors. This will not only bring in capital but also help India develop world-class manufacturing facilities. A shift to local clean tech manufacturing supports the global push for a cleaner, greener environment. Increased use of solar energy and electric vehicles will help reduce carbon emissions and promote sustainability. While India has a growing tech sector, advanced technologies related to EV batteries and solar cells might still require significant R&D and adaptation to local conditions.”

“Bridging this technological gap may take time. Setting up large-scale manufacturing plants for advanced technologies requires significant capital investment. This could strain public finances or require extensive private-sector funding, which might not always be available. Building a robust infrastructure to support clean tech manufacturing is essential. Poor supply chain management, transportation issues, and inadequate infrastructure in rural or less-developed areas could hinder the success of the mission. While the mission aims to promote clean tech, manufacturing processes—especially for batteries and solar panels—can have an environmental impact, such as hazardous waste generation or resource extraction (e.g., lithium, cobalt). Managing these impacts will be crucial. International companies may already have the advantage of scale, technology, and experience in clean tech manufacturing. India will need to ensure that domestic companies can compete in terms of cost and quality with global players, which could be challenging. There may be a gap in the availability of skilled workers, especially in high-tech areas like battery manufacturing, R&D for clean energy, and electrical engineering. Ensuring a skilled workforce through education and training programs is key. The success of the mission will depend on stable and favorable government policies, including tax incentives, subsidies, and regulatory support. Any policy inconsistencies or delays could hinder progress,” shared Shah.

Vinod Aggarwal, MD & CEO, VECV said, “We congratulate the government on presenting a forward-looking and growth-oriented Union Budget 2025–26. The budget reaffirms the government’s strong commitment to strengthening India's manufacturing sector and accelerating the transition to clean and sustainable mobility while bolstering India’s economic resilience. The introduction of the National Manufacturing Mission and the emphasis on Clean Tech Manufacturing, including National Critical Minerals Mission, particularly for EV batteries, motors, controllers, and high-voltage transmission equipment, will provide a significant boost to ‘Make in India’ efforts. The rationalization of custom duties on key raw materials and the reduction of inverted duty structures will also enhance cost-effectiveness in domestic manufacturing. The duty exemption on capital goods for EV battery manufacturing is a welcome step toward accelerating India's electric mobility transition.”

“Furthermore, adjustments in GST rates, incentives for electric vehicle adoption and import duties on components will reshape the industry’s landscape. Increased allocations for infrastructure development, particularly in roads and transportation, will directly fuel demand for commercial vehicles. Additionally, budgetary provisions for working capital support, technology upgradation funds, and easier credit access will play a crucial role in strengthening the MSME ecosystem, ensuring its long-term growth and sustainability. At VECV, we remain committed to advancing sustainable mobility solutions and contributing to India's vision of a self-reliant, cleaner, and more efficient transportation ecosystem. The budget outlines a plan for promoting sustainable transportation through integrated infrastructure development initiative. Overall, the Union Budget 2025 reflects a comprehensive approach to stimulate inclusive economic growth through targeted investments in critical sectors that are essential for India's development trajectory,” added Aggarwal.

Kunal Arya, Co-founder & Managing Director at ZELIO E Mobility Ltd. said, "As India takes another step toward a sustainable future with the 2025-26 Union Budget, the Finance Minister’s focus on promoting clean-tech manufacturing and easing the cost pressures on electric vehicle (EV) production is a commendable move. Exempting critical minerals, such as lithium and lead, from customs duty will provide much-needed relief to the EV industry, supporting growth and reducing import dependency. Additionally, the inclusion of 35 new capital equipment items for lithium-ion battery manufacturing in the exempted list is a strategic move to strengthen domestic capabilities. The commitment to developing a comprehensive ecosystem for solar photovoltaic cells, EV batteries, and other clean technologies signals long-term growth potential. However, despite these positive initiatives, the absence of concrete measures to support long-term subsidies for EVs and a reduction in GST on spare parts remains a missed opportunity for accelerating mass adoption and reducing production costs. These steps are vital for achieving the ambitious growth targets for India’s electric mobility sector."

Shekhar Singal, Managing Director, Eastman Auto & Power, said “The Union Budget 2025 significantly advances India's renewable energy sector with the launch of the Clean Tech Mission, focusing on Solar PV, EVs, and Batteries, alongside the National Manufacturing Mission. The announcements underscore the government's dedication to strengthening ‘Make in India’ and becoming Aatmanirbhar in generation as well as storage of clean energy. This approach aims to reduce import reliance and build a robust domestic industry. From a Solar and Last Mile e-mobility category perspective, the budget with reduction in the BCD for cells and modules prioritizes scaling up of the domestic manufacturing capacities for key components for Solar. The addition of 35 capital goods related to Lithium batteries for EV reduces capital expenditure for setting up manufacturing plants thereby stimulating growth. These strategic measures set India on a path to achieve its 500 GW renewable energy target by 2030, paving the way for energy independence and a cleaner more sustainable future."

Dinesh Arjun, CEO and Cofounder, Raptee.HV discussed, “Innovation and technology are the cornerstones of every developed nation, and India's vision for Viksit Bharat rightly prioritizes these pillars. The Finance Minister’s focus on nurturing and investing in innovation is a commendable step toward accelerating new technologies that will shape our future. The allocation of a Deep Tech Fund will further strengthen India’s industrial ecosystem, fostering a globally competitive, tech-driven economy. A crucial boost to the EV industry comes with the exemption of Li-Ion batteries and other capital goods, which will significantly reduce battery costs and encourage further investment in domestic battery manufacturing. Given that batteries make up 30-40% of an EV’s cost, this move will make EVs more affordable and accessible to consumers, driving mass adoption across two-wheelers, three-wheelers, and four-wheelers alike. By addressing a fundamental cost barrier, this initiative lays a strong foundation for the future of electric mobility in India. We are confident that these strategic measures will have a lasting positive impact on the EV ecosystem in the months to come.”

Prashant Singh, Co-Founder & CEO, Blue Planet, explained, "The Union Budget's full exemption of customs duty on waste and scrap of lithium-ion batteries, lead, zinc, cobalt, and other critical minerals is a significant step forward towards achieving a circular economy. This policy not only incentivizes e-waste recycling but also creates a level playing field for recycling players in India. At Blue Planet, we see this as a catalyst for increased investment in specialized processing facilities, particularly for lithium-ion batteries and other critical minerals. The support for EV and mobile phone battery manufacturing further strengthens this positive momentum. While we applaud these initiatives, we also believe that continued focus on recycling infrastructure and consumer awareness will be crucial for realizing the full potential of this policy. With this new Budget announcement, we are eager to explore more strategic collaborations and contribute our expertise to building a sustainable future for India."

Mahesh Krishnamoorthy, Managing Director, Core Integra said, “Budget 2025 was expected to be a conservative one with no gimmicks considering that the Central Government and Indian economy is currently stable and we need to wait and watch considering the global economic situation and geopolitical scenarios. It is nice to note that the Government’s strategies year on year are aligned to the Vikasit Bharat 2047 vision and the Budget 2025 continues to boost relevant sectors for stable growth over a period of time. Few good things to note in the budget includes the structured approach categorizing growth engines (Agriculture, MSME, Investments, Exports) around relevant domains of Taxation, Power, Urban development, Mining, Financial services and Regulatory reforms which is a robust structure as we move towards a mature economy. The initiative to regulate and provide benefits to gig workers is highly appreciated since this sector is rapidly growing and poised to generate higher employment in the years to come, this initiative will set the pace for additional reforms in this sector. Continued focus on the Udaan scheme is a significant move towards developing Tier 2 and Tier 3 locations in India since the industries would spread and reduce clustering in metros and mini-metros.”

“The government’s push for clean tech manufacturing under the National Manufacturing Mission is a game-changer for the electric vehicle industry. By supporting domestic production of EV batteries and solar panels, India is taking a crucial step toward self-reliance in sustainable mobility. This initiative aligns with the need of the hour, a commitment to accelerating EV adoption through innovative, eco-friendly transportation solutions. Strengthening local manufacturing will not only reduce costs and dependence on imports but also foster job creation and technological advancements in the EV sector. We look forward to leveraging these developments to make electric mobility more accessible and widespread across India,” said Rahul Goenka, Director ElectroRide.

Shivam Narang, Managing Director, Khalsa E-Vehicles Pvt. Ltd. commented, "The Union Budget 2025 laid a strong foundation for India's EV future. By fostering domestic manufacturing, easing battery costs, and promoting clean technology, the government has set the stage for long-term, sustainable growth. The focus on grid-scale batteries will help stabilise the renewable energy grid, ensuring that EVs can be powered by clean energy sources. The exemption of basic customs duty on lithium-ion battery scrap is another commendable move. It promotes a circular economy by making battery recycling more viable, reducing reliance on fresh raw material imports, and decreasing production costs and environmental impact. However, to ensure widespread EV adoption, further policy interventions around charging networks, financing models, and end-user incentives will be crucial. If these aspects are addressed in parallel, India has the potential to become a global leader in EV innovation and clean mobility solutions."

Anurag Choudhary, CMD & CEO of Himadri Speciality Chemical Ltd., said, "The Budget 2025 is a progressive and strategic blueprint that demonstrates the government’s commitment to infrastructure development, innovation, and the vision of Viksit Bharat. The proposal to fully exempt basic customs duty on lithium-ion battery (LiB) scrap, along with critical minerals such as Lead and Zinc, is a transformative policy intervention. This move will not only streamline cost-efficient recycling processes, and ensure a steady supply of essential raw materials, but also enhance their accessibility for domestic manufacturers. Together, these measures will serve as levers to further localize LiB component manufacturing in India, and contribute to the government’s Make in India mission. By fostering a circular economy, this initiative will significantly reduce import dependency, create employment opportunities for India’s youth, and drive the nation closer to self-reliance in EV battery manufacturing. The inclusion of 35 capital goods for EV battery manufacturing and 28 for mobile phone battery manufacturing to the list of capital goods eligible for customs tax exemptions is a decisive step toward strengthening India’s domestic lithium-ion battery production capabilities. This will not only position India as a competitive player in the global EV and electronics supply chain but also catalyze innovation in energy storage technologies, a critical enabler for the clean energy transition.”

“The Budget’s emphasis on Clean Tech manufacturing, particularly EV batteries, along with the allocation of ₹ 20,000 crore for private sector-driven R&D and innovation initiatives is a much-needed move. It will accelerate technological advancements, reduce reliance on foreign know-how, and create indigenous innovation ecosystems. This is particularly significant for industries like ours, where cutting-edge research and development are key to maintaining global competitiveness. For Himadri Speciality Chemical Ltd, this Budget is a major enabler. As a leader in advanced materials and sustainable solutions, our expertise in lithium-ion battery materials, carbon-based products, and renewable energy solutions aligns seamlessly with the government’s vision. This Budget empowers us not only in our endeavour to put India on the global map for LiB component materials with our upcoming lithium iron phosphate (LFP) cathode active material manufacturing facility, but also reinforces our determination to accelerate efforts in developing next-generation technologies, enhancing domestic value addition, and contributing to India’s green energy transition. We are prepared to leverage these policy measures to strengthen our position as a key player in the global clean energy value chain,” added Choudhary.

Subhabrata Sengupta, Partner, Avalon Consulting said, “In EVs, the duty exemption on cell raw materials is welcome. With cell manufacturing plants coming up, this is an encouraging sign. Even more encouraging is the policy continuity and allocation in the programs already announced.”

Anirudh Arun, Co-Founder and CEO, BluSmart Fleet, elaborated, “We welcome the Union Budget for its strategic alignment with India’s net-zero commitments through a comprehensive four-pillar approach to sustainable mobility—manufacturing incentives, a circular economy, consumer adoption, and workforce empowerment. The strong emphasis on sustainability and accelerating the transition to clean mobility solutions is truly encouraging. The National Manufacturing Mission, under the broader Make in India initiative, is a game-changer in democratizing access to EVs. By promoting domestic production of EV components—including batteries, motors, and controllers—and exempting an additional 35 capital goods for EV battery manufacturing, the budget lays a solid foundation for Clean Tech Manufacturing, aligning seamlessly with our vision of a cleaner and greener India.”

“The commitment to a Circular Economy is evident through full tax exemptions on critical minerals such as cobalt powder, lithium-ion battery scrap, lead, zinc, and 12 other key resources, ensuring a sustainable and self-reliant supply chain. Furthermore, the Finance Minister’s focus on social security for gig workers—ensuring healthcare access and formal identification—is a crucial step toward fostering a more inclusive and equitable platform economy. This directly benefits our driver-partners, the backbone of our operations, reinforcing our commitment to their well-being and professional growth. This budget provides a strong fiscal framework for sustainable mobility. The focus must now shift to coordinated execution between policymakers and industry stakeholders to drive meaningful impact on the ground,” Arun commented.

Vinayak Walimbe- President (Interim) – India Energy Storage Alliance and Managing Director – Customized Energy Solutions Pvt. Ltd. India, said, “National Manufacturing Mission, Export Promotion Mission, and duty exemptions on essential raw materials will accelerate India's position as a global hub for energy storage solutions. We welcome the initiatives and support provided by the government towards the battery manufacturing and recycling industry. IESA has been working for more than 10 years towards the growth of these sectors and it’s encouraging to see our recommendations are considered positively towards sector growth. The Union Budget for 2025-2026 has introduced reforms in six key areas: taxation, the financial sector, the power sector, urban development, mining, and regulatory reforms. This budget presents a transformative approach to the energy sector. The National Manufacturing Mission aims to promote clean tech manufacturing and enhance domestic value addition, while also fostering the development of an ecosystem for solar PV cells, EV batteries, motors and controllers, electrolyzers, wind turbines, and grid-scale batteries. Solar energy continues to be the dominant contributor to India’s renewable energy growth, making up 47% of the total installed renewable energy capacity.”

“The BCD exemption on essential raw materials such as cobalt and lithium will help reduce raw material costs, improve manufacturers' profit margins, and enhance the cost-effectiveness of domestically produced lithium components, cells, and electric vehicles. Exempting duties on lithium battery waste and scrap will support battery recyclers in importing feedstock materials to India and enhance metal processing capabilities. This will reduce dependency on imports of freshly mined lithium and encourage domestic cell manufacturers to procure recycled lithium. Furthermore, the expanded Production-Linked Incentive (PLI) schemes and tariff adjustments for critical minerals are expected to strengthen the entire renewable energy ecosystem significantly,” Walimbe elaborated.

Hiren Pravin Shah Founder, MD & CEO - Replus Engitech, said, “Owing to the Union Budget announcement, these are exciting times for the Green Revolution. The import duty cuts on EV batteries and the government's push for technology driven local manufacturing of grid scale batteries are welcome moves for Replus. This initiative aligns perfectly with our vision for an Atmanirbhar Bharat, strengthening our commitment to developing world-class energy storage solutions in India for the global market.”

Mohal Lalbhai, Co-founder & Group CEO, Matter Motor said, “The Union Budget 2025 reinforces India's Net Zero 2070 commitment with key measures to strengthen the clean-tech manufacturing ecosystem. The exemption of Basic Customs Duty (BCD) on critical EV minerals and duty-free

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