India has the potential to become a global manufacturing hub for solar power equipment. The government?s plan to add 20,000 mw of solar power generation capacity by 2022 under the Jawaharlal Nehru National Solar Mission (JNNSM) is the right move to harness this potential. However, the government?s implementation plan seems to be lacking a strategic vision. This has given rise to the fear that India might fail to realise its potential to become an export hub for solar power equipment.
Cost of solar power remains prohibitively high and it will still take time for it to come down. A policy framework to absorb solar power is the prerequisite to attracting investment in the sector. But that is where the government is lagging behind. The government has planned to add solar power generation capacity in three phases. But so far it has unveiled a mechanism for absorbing power from only 1,000 mw solar generation capacity that would be developed in the first phase. Uncertainty still prevails over how power from the rest of the envisaged capacity would be absorbed. Despite its big talk, the government seems to be following only a piecemeal approach for realising India?s potential in solar power equipment manufacturing.
Solar power generation sector needs long-term investment. Serious investors want policy certainty. Unless they are assured of the government?s policy direction, foreign investors would not bet on the Indian solar power market. India has the potential to become a big consumer of solar power equipment given the current trend in growth of power as also its dependence on coal.
The government should leverage its market potential and manufacturing cost advantage to attract international investors into the solar power business. But for that, the government needs to take a long term view. There is no doubt that the Indian solar power market has a huge potential in the long-term. No international investors would like to be left behind. The government needs to provide legal support for solar power consumption if it is serious about developing the sector. That would help in removing prevailing uncertainty on absorption of solar power and bring in the desired investment.
noor.mohd@expressindia.com
