Custom Duty Relief to Accelerate Uttar Pradesh’s Solar and EV Ecosystem, Boost Investments

Lucknow, February 2:
The Union Budget 2026 has provided a significant push to the green energy sector, with targeted custom duty and import tariff exemptions expected to give fresh momentum to Uttar Pradesh’s solar and electric vehicle (EV) ecosystem. Industry experts believe the move will not only reduce production costs but also attract large-scale investments across the state.

Major Boost for Solar, Renewable Energy and E-Mobility

Custom duty relief announced in the Budget for solar energy, renewable power, and e-mobility components is set to strengthen flagship initiatives such as the PM Surya Ghar Yojana and India’s expanding EV ecosystem.
Notably, the government has exempted basic customs duty on critical raw materials used in lithium-ion battery manufacturing, including cobalt powder, battery scrap, and other critical minerals.

Experts say this will have the maximum impact on grid-scale battery storage systems and power grid balancing, key requirements for large-scale renewable energy integration.

Under the PM Surya Ghar Yojana alone, over 10 lakh applications have been received from Uttar Pradesh, highlighting the growing demand for rooftop solar solutions in the state.

Solar Rooftop Systems to Become Cheaper

To further strengthen the solar sector, the Budget has exempted sodium antimonate, a key raw material used in solar glass manufacturing, from customs duty.
Solar glass plays a crucial role in improving the strength, durability, and performance of solar panels.

With the removal of duty, the cost of solar glass is expected to fall, leading to lower prices of solar modules and rooftop solar systems, making clean energy more affordable for households and businesses alike.

Investment Opportunities from Noida to Purvanchal

Following these Budget provisions, fresh investment opportunities are expected to emerge across Noida, Lucknow, Kanpur, and industrial clusters in Purvanchal.
Industry estimates suggest increased interest in:

• Solar manufacturing units
• EV component production
• Battery pack assembly plants
• EV charging infrastructure projects

These developments are likely to generate substantial employment and accelerate industrial activity across the state.

Affordable Expansion of E-Mobility

From an e-mobility perspective, Budget 2026 is being viewed as highly significant for Uttar Pradesh.
With reduced customs duty on batteries and critical minerals, the manufacturing cost of electric vehicles is expected to decline, potentially making EVs more affordable for consumers and supporting wider adoption.

Rural Economy to Gain from Khadi and Village Industries

Minister for MSMEs, Khadi and Village Industries, Silk, Handloom and Textile Industries, Rakesh Sachan, said the Union Budget would open new avenues of opportunity for industries, farmers, and youth.

He noted that the Budget proposes the launch of the Mahatma Gandhi Gram Swaraj Initiative, aimed at promoting khadi, handloom, and handicrafts. The initiative is expected to strengthen the rural economy while providing sustainable livelihood opportunities for artisans and weavers.

Overall Impact

With focused incentives for green energy, e-mobility, and traditional industries, the Union Budget 2026 positions Uttar Pradesh as a key hub for clean energy manufacturing and sustainable industrial growth, reinforcing the state’s role in India’s green transition.