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Breather for solar gear makers

New Delhi: Domestic solar gear makers like Adani Group and Tata Power Solar finally had a breather in a 12-GW scheme mandating state-run firms to set up projects using local equipment. It also paves way for fresh investments in the sector. The Cabinet Committee on Economic Affairs on Wednesday gave its nod to the scheme through which the government will give a viability gap funding support of Rs 8,580 crore by central or state entities for the projects. The scheme, which mandates the use of locally manufactured solar cells and modules, is WTO compliant, the government has maintained. ET had reported on the scheme it its July 23, 2018 edition.

“This (the latest policy) would be making a lot of difference to the solar manufacturing base in the country,” Dhruv Sharma, a member of the governing council for Indian Solar Manufacturers Association (ISMA), told ET. “When you have this kind of demand visibility, it automatically leads to significant investments in technology upgrade as well as capacity expansion,” he said. ET had reported on January 24 that the industry was planning to file a fresh anti-dumping petition, after the safeguard duty that was implanted on imports from China and Malaysia last year, failed to provide any relief to the industry.

“At this stage, we may not be considering an anti-dumping petition. But this is a policy announcement. The devil is in the details,” Sharma said. Mundra Solar, the solar manufacturing unit of Adani Group, Tata Power Solar, Vikram Solar, Waaree Energies are some of the leading equipment manufacturers in the country.

While most industry players ET spoke with welcomed the move, the industry expects at least a year’s time before the impact of the policy begins to show. “The move fails to provide the much needed immediate support to the sector, due to which mid-scale players may not be able to sustain the pressures for the next year, said Sunil Rathi, director of Waaree Energies.

Rathi said an anti-dumping policy is imperative for the creation of a level-playing field for Indian manufacturers. Around 90% of the equipment used in solar projects in the country is imported from China and Malaysia.