Content

1. The Solar Surge: India’s Bold Leap Toward a Net Zero Future
2. Minimum Support Prices (MSPs) for all crops

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The Solar Surge: India’s Bold Leap Toward a Net Zero Future

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Basic Context & Global Position

• Current Global Rankings (2025):
  • 3rd largest solar power producer globally (overtook Japan)
  • 4th in renewable energy installed capacity worldwide
  • 4th in wind power capacity
  • 3rd in solar power capacity

• Key Production Milestone:
  • India: 108,494 GWh solar energy generated
  • Japan: 96,459 GWh (now behind India)

Solar Capacity Breakdown (July 2025)

• Total Solar Capacity: 119.02 GW
  • Ground-mounted solar: 90.99 GW (76%)
  • Grid-connected rooftop: 19.88 GW (17%)
  • Hybrid projects: 3.06 GW (3%)
  • Off-grid installations: 5.09 GW (4%)
• Growth Rate: 4,000% increase in solar capacity over recent years
• Total Solar Potential: 748 GW across India

Relevance : GS 3(Energy Security , Environment and Ecology)

Geographic Distribution & High-Potential States

• Northern & Western Region:
  • Rajasthan, Gujarat (highest potential)
• Southern & Central Region:
  • Karnataka, Tamil Nadu, Andhra Pradesh
• Eastern & Other Regions:
  • Maharashtra, Chhattisgarh, Odisha
• Notable Achievement: Palli village (J&K) became India’s first carbon-neutral panchayat

Manufacturing Capacity Revolution

• Solar Module Manufacturing:
  • March 2024: 38 GW capacity
  • March 2025: 74 GW capacity (95% increase in one year)
• Solar PV Cell Manufacturing:
  • March 2024: 9 GW capacity
  • March 2025: 25 GW capacity (178% increase)
• New Milestone: First ingot-wafer manufacturing facility (2 GW) operational
• Historical Growth (2014-2025):
  • PV cells: 1.2 GW → 25 GW (21x increase)
  • PV modules: 2.3 GW → 78 GW (34x increase)

Government Policy Support

• Import Protection:
  • Basic Customs Duty (BCD) on imported solar cells/modules (April 2022)
  • Mandatory use of Indian-made products in government schemes
• Key Schemes Requiring Domestic Components:
  • Rooftop Solar Programme
  • PM-KUSUM
  • CPSU Scheme Phase II

Major Government Initiatives

PM Surya Ghar: Muft Bijli Yojana

• Budget: ₹75,021 crores
• Target: 1 crore households
• Benefit: Up to 300 units free electricity monthly
• Subsidies:
  • 1 kW: ₹30,000
  • 2 kW: ₹60,000
  • 3 kW+: ₹78,000
• Savings: ₹15,000 annually even after loan EMI

PM-KUSUM Scheme

• Focus: Farmer solar adoption
• Subsidies: 30-50% for solar pumps
• Capacity: Up to 2 MW solar plants per farmer
• Revenue: Farmers can sell electricity to DISCOMs

Solar Parks Scheme

• Target: 40 GW by March 2026
• Approved: 53 parks (39,323 MW capacity) across 13 states
• Operational: 13,896 MW across 26 parks
• Status: 18 parks fully developed (10,856 MW)

PM JANMAN Initiative

• Budget: ₹515 crores
• Target: 1 lakh un-electrified tribal households
• Coverage: 18 states, focusing on PVTGs

Innovative Solar Technologies

• Floating Solar:
  • Omkareshwar Floating Solar Park (Madhya Pradesh)
  • Capacity: 600 MW planned
  • Cost: ₹330 crores
  • Benefits: Land conservation, higher efficiency

• Agrivoltaics:
  • Dual land use: solar + farming
  • Examples: Sun master Plant (Delhi), 105 KW ICAR system (Jodhpur)
  • Benefits: Increased farmer income, efficient land use

Global Leadership Initiatives

International Solar Alliance (ISA)

• Founded: 2015 by India and France at COP21
• Members: 100+ countries
• Investment Target: $1 trillion by 2030
• Focus: LDCs and Small Island Developing States

One Sun One World One Grid (OSOWOG)

• Launched: 2018 at ISA Assembly
• Vision: Global solar grid connectivity
• Coverage: South Asia to Africa and Europe
• Concept: “The sun never sets” – continuous solar supply

Overall Renewable Energy Context

• Total Power Capacity: 484.82 GW
• Renewable Share: 50.07% (achieved COP26 target 5 years early)
• Non-fossil Fuel Capacity: 242.8 GW (June 2025)
• Breakdown:
  • Renewable energy: 233.99 GW
  • Nuclear: 8.8 GW
• Energy Mix:
  • Thermal: 242 GW
  • Solar: 116 GW
  • Wind: 51.6 GW

Growth Trajectory & Achievements

• 2024-25 Record: 29.52 GW renewable capacity added
• 11-Year Growth: RE capacity grew 3x (76.37 GW in 2014 → 233.99 GW in 2025)
• 2030 Target: 500 GW non-fossil fuel capacity

Supporting Renewable Technologies

Wind Energy

• Capacity: 51.6 GW (4.15 GW added in FY 2024-25)
• Global Rank: 4th in onshore wind
• Potential: 1,164 GW
• Contribution: 4.56% of total electricity generation

Bioenergy

• Capacity: 11.60 GW (including waste-to-energy)
• Budget: ₹1,715 crores (National Bioenergy Programme 2021-2026)
• Components: Waste-to-energy, biomass, biogas, biofuel blending

Ethanol Blending

• Current Status: 17.98% blending (February 2025)
• Target: 20% by 2025-26 (ahead of 2030 original target)
• Global Position: 3rd largest ethanol producer and consumer

Green Hydrogen

• Mission Target: 5 million tonnes annually by 2030
• Investment: ₹8 lakh crore expected
• Job Creation: 6 lakh jobs
• Import Savings: ₹1 lakh crore in fossil fuel imports
• Hub Ports: Kandla, Paradip, Tuticorin

Recent Policy Developments (2025)

• July 2025: ₹7,000 crore exemption for NLC India Ltd
• NLC Expansion Plan:
  • Current: 2 GW
  • 2030 target: 10 GW
  • 2047 target: 32 GW

Five Key Strategic Priorities for 2030

1. Better Contracts: Long-term power purchase agreements
2. Stronger Grids: Modern infrastructure with battery storage
3. Make in India: Boost local manufacturing
4. Smart Land Use: Floating solar, agrivoltaics
5. Easy Financing: Accessible funding mechanisms

International Commitments & Progress

Paris Agreement NDCs

• Carbon Intensity: 45% reduction by 2030 (vs 2005 levels)
• Non-fossil Capacity: 50% by 2030 (achieved 5 years early)
• Net Zero Target: 2070

COP26 Commitments (Panchamrit)

• 500 GW non-fossil capacity by 2030
• Currently on track with accelerated progress

Strategic Impact & Benefits

• Energy Security: Reduced dependence on coal imports
• Economic Benefits: Job creation across renewable value chain
• Rural Development: Farmer income enhancement through solar initiatives
• Manufacturing: Domestic production reducing import dependency
• Innovation: Leadership in floating solar, agrivoltaics, green hydrogen

Challenges & Future Outlook

Infrastructure Requirements

• Grid modernization for renewable integration
• Energy storage solutions for intermittency
• Transmission infrastructure development

Policy Success Factors

• Import duties protecting domestic manufacturing
• Subsidy schemes driving adoption
• Mandatory domestic content requirements
• Long-term policy consistency

Conclusion: Key Success Indicators

• Speed of Achievement: Major targets met ahead of schedule
• Comprehensive Approach: Technology + policy + manufacturing + international cooperation
• Social Impact: Rural electrification, farmer empowerment, tribal community inclusion
• Economic Transformation: From energy importer to potential exporter
• Global Leadership: ISA, OSOWOG initiatives positioning India as renewable energy leader

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MINIMUM SUPPORT PRICES (MSPS)FOR ALL CROPS

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What is MSP?

• Definition: Government-guaranteed minimum price for agricultural crops to protect farmers from price volatility
• Coverage: 22 mandated agricultural crops across India
• Authority: Commission for Agricultural Costs & Prices (CACP) recommends MSP rates
• Frequency: Fixed annually by the Government of India
• Implementation: Digital payment system for MSP procurement

Relevance : GS 2(Governance) , GS 3(Agriculture)

Decision-Making Process

• Primary Recommender: Commission for Agricultural Costs & Prices (CACP)
• Consultation Process: Views from State Governments and Central Ministries/Departments
• Final Authority: Central Government fixes final MSP rates
• Scope: Applied uniformly across the country

MSP Performance Data (2024-25: July to June)

Quantitative Achievements

• Total Procurement: 1,175 lakh metric tonnes (117.5 million metric tonnes)
• MSP Amount Paid: ₹3.33 lakh crores (₹33,300 billion)
• Farmers Benefitted: 1.84 crores (18.4 million farmers)

Key Metrics Analysis

• Average MSP per farmer: ₹18,098 per farmer (₹3.33 lakh crores ÷ 1.84 crore farmers)
• Average procurement per farmer: 6.38 metric tonnes per farmer
• Average price per metric tonne: ₹28,340 across all crops

Current Policy Status

Loan Waiver Status

• No active loan waiver scheme currently operational in Department of Agriculture & Farmers Welfare
• Alternative approach: Structured financial support through multiple targeted schemes

Digital Infrastructure

• Payment System: Digital payment implementation for MSP procurement
• Transparency: Enhanced through digital systems
• Efficiency: Reduced transaction costs and time

Supporting Agricultural Schemes

Pradhan Mantri Kisan Samman Nidhi (PM-KISAN)

Basic Structure

• Launch Date: February 2019
• Scheme Type: Central Sector Scheme
• Annual Benefit: ₹6,000 per eligible farmer
• Payment Structure: Three equal installments of ₹2,000 each
• Target Group: Land-holding farmers

Financial Performance

• Total Disbursement: Over ₹3.69 lakh crores since inception
• Installments Completed: 19 installments (as of August 2025)
• Payment Method: Direct Benefit Transfer (DBT) to Aadhaar-seeded bank accounts
• Transparency Features: Complete digital verification and registration process

Impact Analysis

• Average annual disbursement: ≈₹56,000 crores per year (₹3.69 lakh crores ÷ 6.5 years)
• Estimated beneficiaries: ≈9.3 crore farmers (based on ₹6,000 per farmer annually)

Pradhan Mantri Fasal Bima Yojana (PMFBY)

Scheme Overview

• Launch: Kharif 2016 season
• Purpose: Crop insurance against natural calamities and adverse weather
• Objective: Income stabilization for farmers

Financial Performance (2016-2025)

• Farmers’ Premium Paid: ₹35,753 crores
• Claims Paid to Farmers: ₹1.83 lakh crores (as of June 30, 2025)
• Benefit Ratio: 5:1 (claims received vs. premium paid)
• Net Benefit to Farmers: ₹1.47 lakh crores (₹1.83 lakh – ₹0.36 lakh crores)

Coverage and Impact

• Risk Coverage: Natural calamities, adverse weather, pest attacks
• Financial Protection: Comprehensive crop loss compensation
• Affordability: Low premium burden for farmers due to government subsidies

Modified Interest Subvention Scheme (MISS)

Scheme Structure

• Funding: 100% centrally funded
• Coverage: All States and Union Territories
• Target: Short-term agricultural loans through Kisan Credit Cards (KCC)
• Benefit: Concessional interest rates for working capital requirements

Five-Year Financial Performance (2020-25)

Year	Disbursement (₹ Crores)	Year-on-Year Change
2020-21	17,789.72	–
2021-22	21,476.93	20.7%
2022-23	17,997.88	-16.2%
2023-24	14,251.92	-20.8%
2024-25	17,811.72	25.0%

Analysis of Trends

• Total Disbursement (5 years): ₹89,328.17 crores
• Average Annual Disbursement: ₹17,866 crores
• Peak Year: 2021-22 (₹21,477 crores)
• Recent Recovery: 25% increase in 2024-25 after two years of decline

Agriculture Infrastructure Fund (AIF)

Scheme Background

• Launch Year: 2020
• Initiative: Part of Atmanirbhar Bharat package
• Scheme Type: Central Sector Scheme
• Primary Focus: Post-harvest management and community farming assets

Financial Framework

• Total Fund Size: ₹1 lakh crore loan facility
• Interest Rate Cap: Maximum 9% on loans
• Loan Type: Medium to long-term debt financing
• Lending Mechanism: Through established financial institutions

Performance as of June 30, 2025

• Sanctioned Amount: ₹66,310 crores (66% of target achieved)
• Projects Sanctioned: 1,13,419 projects
• Total Investment Mobilized: ₹1,07,502 crores
• Leverage Ratio: 1.6:1 (total investment vs. sanctioned amount)

Project Category Breakdown

• Custom Hiring Centres: 30,202 projects (26.6%)
• Processing Units: 22,827 projects (20.1%)
• Warehouses: 15,982 projects (14.1%)
• Sorting & Grading Units: 3,703 projects (3.3%)
• Cold Storage Projects: 2,454 projects (2.2%)
• Other Post-harvest Projects: 38,251 projects (33.7%)

State-wise Allocation

• Allocation Basis: Ratio of total value of output of Agriculture and Allied sectors
• Coverage: All States and Union Territories
• Decentralized Implementation: State-specific project approval and monitoring

Integrated Analysis of Agricultural Support System

Financial Scale and Impact

• Combined Annual Support: Approximately ₹60,000+ crores across all schemes
• Direct Beneficiaries: 10+ crore farmers across different schemes
• Infrastructure Development: 1+ lakh projects under AIF alone
• Risk Mitigation: Comprehensive crop insurance with 5:1 benefit ratio

Policy Approach: No Loan Waiver Strategy

Why No Loan Waiver?

• Structured Support Preferred: Multiple targeted schemes instead of blanket waivers
• Sustainability Concerns: Loan waivers can create moral hazard and fiscal burden
• Comprehensive Coverage: MSP, income support, insurance, infrastructure development

Alternative Support Mechanisms

• Income Support: PM-KISAN provides direct cash transfers
• Price Protection: MSP ensures minimum guaranteed prices
• Risk Coverage: PMFBY provides comprehensive crop insurance
• Credit Support: MISS reduces borrowing costs
• Infrastructure: AIF develops post-harvest facilities

Technology Integration

• Digital Payments: MSP procurement through digital systems
• Aadhaar Integration: PM-KISAN uses Aadhaar-seeded accounts
• DBT Implementation: Direct Benefit Transfer reduces leakages
• Transparency: Digital systems ensure accountability

MSP System Challenges

• Limited Crop Coverage: Only 22 crops out of hundreds grown
• Geographic Concentration: MSP procurement mainly in certain states
• Storage and Logistics: Infrastructure constraints in procurement
• Price Discovery: Market prices often below MSP for many crops

Scheme-specific Challenges

PM-KISAN

• Landholding Requirement: Only land-owning farmers eligible
• Small Amount: ₹6,000 annually may be insufficient for meaningful impact
• Documentation: Requires proper land records

PMFBY

• Claim Settlement: Delays in claim processing
• Coverage Gaps: Some risks not covered
• Premium Burden: Even subsidized premium can be high for marginal farmers

MISS

• KCC Penetration: Not all farmers have Kisan Credit Cards
• Documentation Requirements: Formal credit procedures
• State Variations: Implementation quality varies across states

AIF

• Loan-based: Requires repayment capacity
• Technical Expertise: Need for project preparation and management
• Collateral Requirements: May limit access for small farmer

Future Outlook and Recommendations

Strengthening MSP System

• Expand Crop Coverage: Include more crops in MSP framework
• Improve Procurement Infrastructure: Better storage and logistics
• Market Integration: Link MSP with market development
• Price Rationalization: Regular review of MSP calculation methodology

Enhancing Support Schemes

• Universal Coverage: Extend benefits to tenant farmers and agricultural laborers
• Amount Rationalization: Increase PM-KISAN amount based on inflation
• Technology Upgrade: Further digitalization of all processes
• Convergence: Better coordination between different schemes

Infrastructure Development

• Accelerate AIF Implementation: Achieve full ₹1 lakh crore target
• Value Chain Development: Focus on processing and marketing infrastructure
• Technology Adoption: Promote modern agricultural technologies
• Climate Resilience: Develop climate-smart infrastructure

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