New Delhi’s power corridors lit up with a major announcement as the Modi-led Cabinet approved a ₹2,584.60 crore initiative to propel small hydro projects (SHPs) nationwide. Spanning 2026-27 to 2030-31, the scheme focuses on 1-25 MW installations, prioritizing hilly terrains and the Northeast where hydro potential remains largely unexplored.
Job creation stands out as a cornerstone, with 51 lakh man-days during construction and sustained employment in rural operations. The decentralized nature slashes transmission losses, making these projects efficient for off-grid power supply.
Funding varies by region: Border and northeastern areas get generous support up to ₹3.6 crore/MW or 30% cost (max ₹30 crore/project), while others receive ₹2.4 crore/MW or 20% (max ₹20 crore). Over ₹2,532 crore targets tough geographies, expecting to draw ₹15,000 crore total investment.
‘Make in India’ is mandatory for all equipment, fostering domestic manufacturing. A ₹30 crore fund aids states in crafting DPRs for 200 projects. These eco-friendly ventures sidestep major environmental pitfalls like flooding or relocation, offering 40+ year operational lifespans.
This forward-thinking policy not only accelerates clean energy adoption but also drives economic growth in backward regions. By bridging energy access gaps, it promises lasting employment, local investment, and a greener future, aligning perfectly with India’s renewable ambitions.
