Policies & Incentives Needed to Boost Domestic Solar Manufacturing: Saibaba Vutukuri, Vikram Solar

This year’s Union Budget should bring a policy framework for both tariff and non-tariff barriers apart from long-term financial support and direct incentives to make the domestic solar industry cost-competitive, said Saibaba Vutukuri, chief executive officer, Vikram Solar.

“There is an immediate need to build a robust ecosystem for indigenous solar manufacturing and making it cost-competitive to achieve the vision of Aatmanirbhar Bharat,” he said.

Vutukuri added that the finance ministry should consider 5 per cent interest subvention on term loan and working capital, upfront central financial assistance of 30 per cent on capex, increase export incentive from 2 per cent to 8 per cent under remission of duties or taxes on export product.

According to the firm, the industry awaits the implementation of basic custom duty (BCD) with exemption to special economic zone (SEZ) based solar manufacturers and the production-linked incentive (PLI) scheme.

“We recommend the government to consider implementing tariff barriers for at least four to five years. Offering capital subsidy of 50 per cent for setting up R&D and quality testing infrastructure within the manufacturing units to help build scale.

It added that super-deductions of 200 per cent of the R&D expenditure for new and clean solar technology development should be allowed. Special funds should be allocated for the development of the electric vehicle battery ecosystem.