The Centre has given an ?in-principle? approval to 12 of the 15 investment applications received for incentives under the existing semiconductor policy. Of these, six proposals have received financial closure, said India Semiconductor Association (ISA).
FE has learnt that proposals from Moser Baer, KSK Surya Photovoltaic Ventures, Lanco Solar, Bhaskar Silicon and Solar Semiconductors have received financial closure after firms demonstrated capability to raise funds to the extent of Rs 1,000 crore as required.
The proposals have been cleared based on the data submitted by 12 companies. The government subsidy will follow when they achieve financial closure and other milestones.
The policy, which encourages semiconductor and solar PV manufacturing, offers a capital subsidy of 20% for manufacturing plants in SEZs and 25% for manufacturing outside SEZs. The subsidy, however, is based on the condition that the net present value (NPV) of the investment is at least $212 million.
As of December 2009, the government had received 15 applications with investment proposals worth Rs 1,30,899 crore.
New investors are considering states like Andhra Pradesh, UP, West Bengal and Tamil Nadu as their destination for solar PV production. Andhra Pradesh, for instance, is developing a solar farm cluster called Solar City on 10,000 acre at Kadiri in Anantapur district. The city is expected to attract investments worth Rs 3,000 crore in the first phase.
?The recent investments in solar PV manufacturing are essentially from large players looking at both domestic and export markets. As the cost of power generation from solar PV reduces, India itself could emerge as a market for solar energy,? said ISA president Poornima Shenoy.
Citing latest data from ministry of new and renewable energy (MNRE), ISA said during 2008-09, 15 companies were actively engaged in the manufacture of solar cells in India and 20 in the manufacturing of modules. And about 50 companies are actively engaged in the manufacturing of various PV systems. The overall production in the country during 2008-09 is estimated to be over 175 MWp of solar cells and 240 MWp of PV modules.
India has always been a net exporter of solar PV technology with about 66% of overall domestic PV production till 2009 catering to the overseas market. According to the commerce ministry, India?s export of solar PV amounted to Rs 2,452 crore in 2008-09, a jump from Rs 956 crore, the country exported in 2007-08. Germany and Spain account for about 82% of total exports from India.