The largest single investment in the Indian economy by a foreign organization has been announced – $20 billion to generate 20 gigawatts of solar energy. The Prime Minister’s goal to generate 100 GW by 2022 now looks a little more achievable
Japan’s SoftBank Corp has just announced that it will invest $20 billion over the next ten years to generate 20 gigawatt of solar power in India. The investment will be in association with Indian telecom firm Bharti Enterprises and Taiwanese mobile handset maker Foxconn.
SoftBank – owner of one of Japan’s biggest mobile carriers and the largest shareholder in Chinese e-commerce giant Alibaba – will have majority control in the joint venture, which will be called SBG Cleantech.
Making the announcement in New Delhi on June 22, Masayoshi Son, Chairman and CEO of Softbank, said, “Softbank will take the lead and responsibility to make 20GW as a minimum commitment in solar space in India. In economic terms grossly $20 billion will be the scale of investment. It could probably be one of the largest investments by a foreign company in India.”
Stock market analysts later confirmed that it would be the largest single investment in an Indian project by a foreign firm, though all the $20 billion would not come from Softbank.
Earlier in June, the Ministry of New and Renewable Energy had officially confirmed what Prime Minister Narendra Modi has been saying for months – India’s solar power generation capacity target is now 100 GW by 2022, a fivefold increase on the earlier target.
The Softbank chief was clearly aware of the biggest obstacles in rolling out solar power generation in India – outdated policies and shortage of land. He said he would like to see the new firm generating 20 GW within the next ten years, “but how fast we would be able to accelerate will depend on local and central government and availability of land.”
Son said once the project received all government clearances and the land for the solar parks it plans, it would take two years before power could be fed to the grid.
Sunil Mittal, Chairman of Bharti Enterprises, said the new firm SBG Cleantech Ltd will be headed by Manoj Kohli as Executive Chairman, with Raman Nanda as Chief Executive Officer. It will have its headquarters in New Delhi.
Having set up a slew of clean energy projects after the 2011 Fukushima nuclear plant disaster in Japan, Softbank has a record in the field. It has already invested $1 billion in other firms in India in the past nine months, part of a separate plan to invest $10 billion in India over the next 10 years.