The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the ‘Small Hydro Power (SHP) Development Scheme’ for the period 2026–27 to 2030–31, with a total outlay of ₹2,584.60 crore to develop around 1,500 MW of capacity.
The scheme aims to promote small hydro projects ranging between 1 and 25 MW, particularly in hilly and North Eastern regions where such potential remains largely untapped. Higher central financial assistance has been provided for these areas, along with border districts, to encourage project development in remote and difficult terrains.
Out of the total allocation, ₹2,532 crore has been earmarked for project implementation, which is expected to attract investments worth nearly ₹15,000 crore in the sector. The initiative is also aligned with the Atmanirbhar Bharat vision, as it will rely on domestically sourced equipment and machinery.
In addition, the scheme provides support for preparing detailed project reports for around 200 future projects, helping create a strong pipeline for sustained growth in the sector.
The government estimates that the scheme will generate nearly 51 lakh person-days of employment during the construction phase, besides creating long-term jobs in operations and maintenance.
Officials said the initiative will help revitalise the small hydro sector, promote clean and sustainable energy, and support socio-economic development in rural and remote areas while minimising environmental impact due to its decentralised nature.
Nurturing Creativity – Keekli Charitable Trust, Shimla
