India's Renewable Energy Investment Roadmap for NRIs: Updated 2026 Guide

The Big Picture: 50 GW Every Year Until 2028, Then 500 GW by 2030, and 900 GW by FY36

India's Ministry of New and Renewable Energy (MNRE) issued guidelines on 31 March 2023 that commit the country to adding 50 GW of renewable energy capacity every single year from FY 2023-24 through FY 2027-28. This is part of the larger national goal to reach 500 GW of non-fossil fuel capacity by 2030, with an extended trajectory targeting approximately 900 GW of non-fossil fuel capacity by FY36 (fiscal year ending March 2036). As of March 2026, India has achieved over 520 GW of total installed capacity, with non-fossil sources now representing over 50% of the energy mix. Solar capacity alone has grown from 2.8 GW in 2014 to 143 GW as of March 2026, with 49 GW added in 2025 alone. For you as an NRI investor, this means a decade-long pipeline of opportunities—not a one-off scheme that might disappear.

Reaching the 500 GW target by 2030 requires approximately ₹30 lakh crore in total investments, emphasizing the critical role of private and institutional capital beyond public sector limits. The longer-term vision to 900 GW by FY36 will require ₹7.93 lakh crore in transmission infrastructure capex alone, covering 1,37,500 circuit kilometers of transmission lines and 8,27,600 MVA of substation capacity. This represents one of the largest infrastructure buildouts globally.

The Climate Investment Funds (CIF) Renewable Energy Integration (REI) Program, approved in October 2024, reinforces this trajectory by channeling international climate finance into grid modernization, energy storage, and offshore wind infrastructure. This signals that India is serious about attracting private capital—including NRI capital—across the entire renewable energy value chain.

Within that 50 GW annual target, at least 10 GW must come from wind energy projects each year. This reservation exists because wind projects historically faced underbidding and needed a boost. The rest comes from solar, hybrid systems, and Firm and Dispatchable Renewable Energy (FDRE) projects—a newer category that includes green hydrogen storage and round-the-clock renewable power.

FDI Rules: 100% Automatic Approval, No Government Gatekeeping

Here is the game-changer for NRI investors: the renewable energy sector allows 100% Foreign Direct Investment under the automatic route. This means you do not need to apply to the government, wait for approval, or justify your investment to a committee. You can invest directly, and the money flows through without bureaucratic delays. The CIF REI Program and MNRE's 2026 policy updates confirm this remains unchanged and actively encouraged.

This automatic FDI applies to:

Direct equity stakes in solar, wind, or hybrid power projects
Investments in Special Purpose Vehicles (SPVs) that bid for renewable energy contracts
Module manufacturing linked to the Production-Linked Incentive (PLI) scheme
Green hydrogen projects under the National Green Hydrogen Mission
Infrastructure development in solar parks
Energy storage systems (battery storage, green hydrogen electrolysers)
Offshore wind port infrastructure and transmission upgrades
Grid modernization and transmission infrastructure development
Rooftop solar deployment and EPC services

You can participate in two main ways. First, you can invest directly in project development and bid for power procurement contracts issued by Renewable Energy Implementing Agencies (REIAs) like SECI, NTPC, NHPC, and SJVN. Second, you can take equity stakes in Indian developers who are bidding for these contracts. Both routes are open.

FEMA (Foreign Exchange Management Act) provisions allow NRIs to invest in non-debt instruments—equity, for example—without the bureaucratic friction that sometimes slows other sectors. Profits are repatriable after tax compliance. If you are investing from countries like Mauritius or Singapore, you can leverage Double Taxation Avoidance Agreements (DTAA) to optimize your tax position. You can also use the RBI's Liberalised Remittance Scheme (LRS) to invest up to USD 250,000 annually for portfolio investments in renewable energy bonds and equity instruments.

How the Bidding Process Works

MNRE's Standard Bidding Guidelines (implemented from FY 2023-24 onwards and updated on February 2, 2024) govern how power is procured from grid-connected solar, wind, wind-solar hybrid, and FDRE projects. The process is transparent and competitive:

Reverse Auction Model: Developers bid to supply power at the lowest tariff. The REIA (SECI, NTPC, etc.) accepts the lowest qualified bidder. This drives tariffs down but ensures only serious, financially sound developers win.

Qualification Requirements: To bid, you must demonstrate technical and financial capacity—typically through net worth, prior project experience, and equipment certifications. NRIs can meet these requirements through Indian SPVs or joint ventures with local partners.

Power Purchase Agreements (PPAs): Once you win a bid, you sign a 25-year PPA at the tariff you quoted. This long tenure gives you revenue certainty for two and a half decades. The obligated buyer (usually a state electricity distributor or REIA) commits to purchasing your power.

Financial Closure and Commissioning: You have 12 months from bid award to achieve financial closure (secure all funding). Commissioning must happen within 24 to 36 months, depending on project type. Delays incur penalties—for example, a 1.5x tariff reduction per day after the scheduled date.

Cost Waivers That Boost Your Returns

Two major cost reductions apply to eligible renewable projects:

ISTS Charge Waiver: Inter-State Transmission System (ISTS) charges are waived for renewable energy projects until 2030. These charges normally apply when power crosses state boundaries. For large solar parks or wind farms that sell power across states, this waiver reduces your Levelized Cost of Electricity (LCOE) by 5 to 10 percent. That directly improves your project's profitability.

Renewable Consumption Obligation (RCO): MNRE has notified an RCO trajectory through 2029-30. This means state electricity distributors and other obligated entities must procure a specified percentage of their power from renewable sources. This creates guaranteed demand for your power, reducing offtake risk.

Solar Parks Scheme: Plug-and-Play Infrastructure Until 2026

On 16 June 2023, MNRE extended the Scheme for Development of Solar Parks and Ultra Mega Solar Power Projects until 31 March 2026. This scheme provides ready-made infrastructure for solar developers:

What You Get: Developed land (parks can host up to 5000 MW), transmission connectivity, water supply, and roads. You do not have to acquire land yourself or negotiate with state governments for transmission access.

Central Financial Assistance (CFA): The government provides Rs 20 lakh per MW of park infrastructure, capped at Rs 30 crore per park. This reduces your upfront capital requirement.

How It Works: States identify and provide land. SECI allocates parks to developers via competitive bidding. NRIs can invest in park development, power generation within parks, or module manufacturing facilities.

Over 50 solar parks are operational or under development. The extension to March 2026 gives you a clear runway to plan and execute investments.

Rooftop Solar: Distributed Generation Opportunity

If large utility-scale projects feel too capital-intensive, consider the Grid Connected Rooftop Solar (RTS) Programme. MNRE extended Phase-II of this scheme on October 6, 2022, and it now runs through March 31, 2026.

What the Scheme Offers:

Central Financial Assistance (CFA) of Rs 14,588 per kW for systems up to 2 kW
Rs 14,100 per kW for systems between 3-10 kW
Targets residential, group housing, and social sectors
Net metering allows consumers to offset electricity bills by feeding surplus power back to the grid
Cumulative capacity target: 4 GW
Over 32 lakh households enrolled as of March 2026

For NRIs: You can establish a subsidiary to deploy rooftop systems, provide EPC (Engineering, Procurement, Construction) services, or finance projects through IREDA (Indian Renewable Energy Development Agency) green bonds. The 100% FDI automatic route applies here too. Compliance requires:

DISCOM (Distribution Company) empanelment
Quality certification via ALMM (Approved List of Models and Manufacturers) for solar modules
Online application through www.pmsuryaghar.gov.in
State electricity regulatory commission approval for net metering
Safety standards per IS 16221
Five-year equipment warranties

The scheme is projected to empower 1 crore (10 million) households by 2026, creating significant business opportunities in installation, maintenance, and financing.

Solar Module Manufacturing: The PLI Scheme

If you want to move upstream into manufacturing, the Production Linked Incentive (PLI) Scheme for high-efficiency solar PV modules is your entry point. MNRE notified Tranche-II on September 30, 2022.

The Scale:

39,600 MW of domestic solar PV module manufacturing capacity allocated to 11 companies
Rs 14,007 crore incentive outlay
Rs 93,041 crore total investment expected
1,01,487 jobs projected (35,010 direct)

Capacity Milestones:

7,400 MW operational by October 2024
16,800 MW by April 2025
Full 39,600 MW by April 2026

Module Specifications: Only high-efficiency modules (above 19.5% efficiency) qualify. This drives technological advancement and reduces India's import dependence.

For NRIs Investing in Manufacturing:

100% FDI automatic route applies
You can set up wholly-owned plants or joint ventures
Bidder financial net worth requirement: Rs 100 crore per MW of capacity
Bank guarantees required
Annual capacity utilization must exceed 80%
Incentives are disbursed based on sales performance, technology upgrades, and domestic value addition
Domestic Value Addition (DVA) mandate: 50% by year 5
BIS (Bureau of Indian Standards) certification required
ALMM listing mandatory
Incentive tenure: 5-7 years from notification

Financing Options: IREDA provides debt financing. SEBI-regulated green bonds can raise equity. The tied demand from the 50 GW annual bidding trajectory ensures off-take for your modules.

Wind Power: Onshore Guidelines and Repowering Opportunities

MNRE issued amended guidelines for onshore wind power projects, with the latest version effective March 5, 2026 for new tenders. Key features include:

Minimum Project Capacity: 50 MW per project, with flexibility for larger hybrid wind-solar setups.

Competitive Bidding: Wind projects go through reverse auctions conducted by SECI or designated state agencies. Developers must secure land rights, environmental clearances, and grid connectivity approvals before bidding.

Hybrid Wind-Solar Models: The guidelines actively encourage combining wind with solar or energy storage on the same site to optimize land use and improve grid stability. Wind-solar hybrid projects now have tariffs in the range of Rs 2.6 to Rs 3.1 per kWh, with a minimum 25% hybrid ratio.

Commissioning Timelines: Projects must achieve financial closure within 12 months of award and complete commissioning within 24 to 36 months. Delays attract penalties of up to 1.5% of contract value per month.

Wind Repowering Policy (effective December 7, 2023): This policy targets wind farms installed before April 1, 2016, allowing developers to replace old turbines (under 3 MW capacity) with modern, higher capacity units. The goal is an additional 20 GW of wind capacity by 2030. Eligible projects receive:

Viability gap funding of up to 20% of project cost through IREDA
Central financial assistance of Rs 10 to 15 lakhs per MW
Priority grid access
Capacity utilization factor (CUF) improvement from 20-25% to 35-40%, significantly boosting investor returns
A 1.2x tariff premium for repowered projects
Generation Based Incentives (GBI) of up to Rs 0.50 per kWh

Repowering transforms underperforming legacy wind assets into high-yield modern installations. For NRIs looking at direct equity or SPV participation, repowered wind farms offer a de-risked entry because the sites already have land, grid connectivity, and operational history.

Green Hydrogen Integration: The Next Frontier

India's National Green Hydrogen Mission (NGHM), launched with an initial outlay of Rs 19,744 crore, is being integrated with the renewable energy bidding trajectory. FDRE projects (Firm and Dispatchable Renewable Energy) can now include green hydrogen storage and electrolysers. This means:

You can invest in solar or wind farms that produce power for hydrogen generation
The hydrogen can be stored and used to generate electricity when the sun is not shining or wind is not blowing
This creates "round-the-clock" renewable power, which commands premium tariffs
The SIGHT scheme (Strategic Intervention for Green Hydrogen Transition) supports these hybrid projects with Rs 17,490 crore in incentives for 5 GW of electrolyser capacity by 2025-30

Green Hydrogen Hubs and Hydrogen Valley Innovation Clusters: The revised NGHM guidelines create a framework for large-scale production centres with dedicated power lines, water desalination, and storage infrastructure. Key financial parameters include:

Central Financial Assistance (CFA) of up to Rs 1,500 crore per hub
Minimum production capacity of 10,000 MTPA green hydrogen per hub
PLI for electrolysers at Rs 4,400 per kW incentive
Debt-equity norm of 70:30
First hubs operational by 2027
National target of 5 million metric tonnes per annum (MMTPA) green hydrogen by 2030

For NRIs with exposure to clean energy or industrial decarbonisation, this opens a new investment avenue beyond traditional solar and wind. The CIF REI Program explicitly supports green hydrogen as part of India's updated Nationally Determined Contributions (NDCs), which now target reducing GDP emissions intensity by 45% from 2005 levels (up from 33-35%) and achieving 50% cumulative electric power capacity from non-fossil sources (up from 40%).

Energy Storage: A New Pillar for Grid Stability

The CIF REI Program and MNRE's 2026 updates highlight energy storage as critical infrastructure. India is deploying approximately 1500 megawatt-hours (MWh) of energy storage capacity to support grid stability and enable higher renewable penetration. The National Resource Adequacy Plan released at the Bharat Electricity Summit 2026 (March 22-24, New Delhi) identifies approximately 200 GW of pumped storage potential across India. This includes:

Battery energy storage systems (BESS) for solar and wind farms
Green hydrogen storage linked to electrolysers
Pumped hydro storage where geography permits
Advanced Chemistry Cell (ACC) battery storage under the PLI scheme with an outlay of Rs 18,100 crore

As an NRI investor, you can finance or develop energy storage projects independently or as part of hybrid renewable projects. Storage projects attract the same 100% automatic FDI approval and benefit from ISTS waivers until 2030. Lenders view storage projects favorably because they reduce grid integration risk and improve power evacuation reliability.

Grid Modernization and Transmission Infrastructure: ₹7.93 Lakh Crore Investment

The CIF REI Program commits to upgrading approximately 3700 circuit kilometers (ckm) of 33 kV distribution lines and strengthening inter-state and intra-state transmission capabilities. India's broader renewable energy roadmap targets ₹7.93 lakh crore in transmission capex to address evacuation challenges and enable grid integration toward the 900 GW target by FY36. The transmission network must expand from the current 5 lakh circuit kilometers to 6.37 lakh circuit kilometers, with substation capacity increasing to 8,27,600 MVA. This is not just government infrastructure—it creates opportunities for NRI investors:

Transmission Infrastructure: You can invest in transmission line development, substation upgrades, and smart grid technologies through public-private partnerships (PPPs). These projects offer stable, long-term returns because they are backed by state electricity boards and central transmission utilities.

Offshore Wind Ports: India is developing port infrastructure to support offshore wind projects, particularly along the coasts of Gujarat, Maharashtra, and Tamil Nadu. These ports require specialized equipment, dredging, and storage facilities.

State-Level Investment Opportunities for NRIs

Beyond the national framework, several states have announced ambitious renewable energy targets and investment opportunities:

Gujarat: Targeting 190 GW of renewable energy capacity by 2047, with existing solar and wind parks offering immediate investment opportunities.

Andhra Pradesh: Positioning itself as a clean energy hub with over ₹6 lakh crore in planned investments. The state offers dedicated renewable energy zones and streamlined land allocation for developers.

Maharashtra: Targeting 280 TWh of electricity demand by 2030, requiring significant renewable capacity additions. The state has active solar parks and wind zones.

Bihar: Focusing on energy storage and grid infrastructure development to support renewable integration.

Delhi: Developing a high-renewable urban energy system with rooftop solar and distributed generation.

NRIs can participate in state-level projects through direct investment, joint ventures with state development corporations, or by financing projects through green bonds and institutional channels.

Financing and Tax-Efficient Repatriation for NRI Investors

Several financing mechanisms support NRI participation:

IREDA Green Bonds: Indian Renewable Energy Development Agency issues green bonds that NRIs can purchase. These bonds offer competitive returns and are backed by government guarantees.

Corporate Green Bonds: SEBI-regulated green bonds issued by renewable energy companies provide equity and debt financing options.

Bank Financing: Major Indian banks offer project financing for renewable energy with tenure up to 18-20 years, matching PPA periods.

Tax Compliance and Repatriation: After paying applicable Indian income tax on profits, NRIs can repatriate funds freely under FEMA provisions. If you are a resident of a DTAA country, you can claim foreign tax credits to avoid double taxation. Dividend income from renewable energy SPVs is taxed at the corporate rate (currently 25-30% for domestic companies, with potential DTAA benefits for NRIs).

Long-Term Capital Gains: If you hold equity in renewable energy projects for more than 24 months, long-term capital gains tax applies at 20% (with indexation benefit) or 12.5% (without indexation), depending on your tax residency status and DTAA applicability.

The Bigger Picture: Long-Term Energy Transition

India's energy transition extends beyond 2030. The long-term vision to 2070 involves over USD 22 trillion (approximately ₹1,800 lakh crore at current rates) in investments across the energy sector. Within the next two decades alone, the power sector offers ₹200 lakh crore in investment opportunities as India transitions to a predominantly renewable energy system.

For NRIs, this represents not just a decade of opportunities but a multi-generational investment thesis. The combination of policy certainty, transparent bidding processes, automatic FDI approval, and long-term PPAs creates a compelling risk-adjusted return profile. Whether you invest in utility-scale solar and wind, green hydrogen hubs, energy storage, rooftop solar deployment, or manufacturing, India's renewable energy roadmap offers pathways aligned with your investment horizon and risk appetite.

The Bharat Electricity Summit 2026 (March 22-24, New Delhi), inaugurated by Union Minister Manohar Lal, reaffirmed India's commitment to these targets and highlighted the critical role of private capital, including NRI participation, in achieving energy security and self-reliance. Consult MNRE, DPIIT, and your tax advisor to structure investments optimally for your circumstances.