India is committed to maintaining a diversified energy portfolio to ensure its growing energy demands are met reliably and affordably. This strategy involves sourcing energy from multiple locations and diversifying the energy mix to include renewables, nuclear, and other non-fossil sources, alongside traditional fossil fuels.
The Ministry of External Affairs (MEA) has emphasized that securing energy supplies for India's 1.4 billion citizens is a top priority. In line with this, the government is actively widening its energy procurement across various markets, adapting to objective market conditions and evolving international dynamics. This approach aims to protect consumer interests by ensuring adequate energy availability, fair pricing, and reliable supply. India is keen on not being overly reliant on any single source for crude oil and intends to import from a mix of sources based on market conditions, guided by national interests.
India's commitment to diversifying its energy mix is reflected in its increasing investments in renewable energy. Solar PV, in particular, has seen a surge in investment, constituting over half of the total non-fossil investment. In 2024, 83% of power sector investment was directed towards clean energy. India is also promoting investment in nuclear energy to meet its rising electricity demand. The country aims to increase its nuclear capacity tenfold to 100 gigawatts (GW) by 2047. To support this expansion, the government has lifted customs duties on imports of nuclear power equipment until 2035.
The Union Budget 2026-27 has further reinforced India's renewable energy push with a focus on storage, manufacturing, and financing. Fiscal incentives are being aligned with long-term policy certainty to de-risk clean-energy investments. The budget also promotes the energy storage sector by offering fiscal incentives for lithium-ion battery manufacturing. These measures aim to reduce production costs, improve viability, and attract investments, positioning India as a competitive hub in the global clean energy market.
India's energy strategy also involves securing reliable access to critical minerals, such as lithium, cobalt, and rare earth elements, which are essential for renewable energy technologies and electric vehicle production. The country is actively pursuing domestic exploration, diversified international partnerships, and circular economy development to enhance its mineral security. Trade policy adjustments, including duty exemptions for lithium-ion battery components and solar manufacturing inputs, are also being implemented to support domestic manufacturing.
While India is committed to expanding its renewable energy capacity, fossil fuels are expected to continue playing a significant role in its energy mix in the near to medium term. Oil demand is projected to rise to roughly 9 million barrels per day by 2050, and coal is expected to remain a major component of India's primary energy mix. Therefore, India's energy strategy involves a balancing act between managing its energy transition, meeting its development needs, and achieving its long-term climate ambitions.