The government’s move to shift from the use of short-term ‘safeguard duties’ to protect domestic manufacturers to the imposition of customs duties has induced the industry to make long-term commitments in terms of investments.
India’s solar industry, which heavily depended on imports from China, has started to see a new wave of self-reliant developments. After Prime Minister Narendra Modi launched Atma Nirbhar Bharat Abhiyaan, the Renewable Energy Ministry has received proposals from various players for over 10 GW of fresh solar equipment manufacturing, reported The Indian Express. The government’s move to shift from the use of short-term ‘safeguard duties’ to protect domestic manufacturers to the imposition of customs duties has induced the industry to make long-term commitments in terms of investments, Power and Renewable Energy Minister R K Singh told the paper.
The minister added that a proposal to designate manufacturing zones for solar manufacturing is also being considered. He further said that a 5 per cent interest subvention scheme for the domestic manufacturing of ingots, wafer, and cells has gone to the Ministry of Finance and the duty changes will be WTO compliant.
India has so far received proposals from the US-based First Solar, Gurgaon-based Renew Power, Kolkata-based Vikram Solar, and the Delhi-headquartered Waaree Energies. After the government imposed additional duties on imports across sectors, including solar power, the interest in solar equipment manufacturing started to rise.
The Modi government has set a target of installing 175 GW of renewable energy capacity by the year 2022, which includes 100 GW from solar, 60 GW from wind, 10 GW from bio-power, and 5 GW from small hydro-power. So far, India has a solar energy capacity of 35 GW, according to the Central Electricity Authority.
Meanwhile, India has till now implemented only safeguard duties on the import of solar equipment from China and Malaysia, which have been extended until July 2021 at a rate of around 15 per cent. The Renewable Energy Minister said that the government always felt that a safeguard duty is of limited duration and will therefore not induce people to make long-term commitments in terms of investments and, therefore, there should be basic customs duties.