India solar duty fails domestic producers as demand dwindles

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India’s bid to protect its solar-equipment makers by imposing a safeguard duty on cheap, Chinese imports has failed, according to domestic manufacturers, who are campaigning for tougher measures.

The country last year imposed a 25% tariff on solar cells and modules imported from China and Malaysia for two years. That has resulted in developers either stalling projects to circumvent the two-year timeframe or sourcing cheap imports from Southeast Asia, the Indian Solar Manufacturers Association and equipment makers including Waaree Energies Ltd., Jupiter Solar Power Ltd. and Vikram Solar Ltd. said.

“There is a duty, yet it’s not fulfilling its role,” Jupiter Solar Chief Executive Officer Dhruv Sharma, who is also a member of ISMA’s governing council, said. “No new manufacturers came in, new capacity hasn’t come in, people are shutting shop, employment hasn’t been generated.”

More stringent measures are needed including the addition of anti-dumping and countervailing duties to the safeguard tariff, according to ISMA General Secretary and IndoSolar Ltd. CEO Rahul Gupta. The industry body last year withdrew a petition seeking anti-dumping duties on imports of solar cells and modules, saying at the time it would file a fresh one.

“We are working on an option of filing an anti-dumping petition. Documentation is getting ready and data is being collected,” Jupiter Solar’s Sharma said.

India, which overtook Japan as China’s biggest solar panel export market in 2017, has been struggling to spur its nascent domestic manufacturing industry that the government estimates can meet just 15 percent of the country’s annual requirement. The South Asian nation has been seeking to boost domestic manufacturing capabilities, through both manufacturing tenders as well as the safeguard duty.

It imposed the safeguard duty, with effect from July 30, saying overseas supplies have caused or threatened “serious injury” to manufacturers at home. On Tuesday, the South Asian said it will issue a new, smaller tender to encourage local manufacturing of solar energy equipment after scrapping a larger maiden bid that received poor investor response.

source@morning standard