Affected by China's production capacity, India is considering delaying tariffs on imported solar products or extending project delivery deadlines

　　On October 12, Indian Minister of Renewable Energy RK Singh stated that considering the uncertainty of the price increase of China's imported solar products, the Indian government is considering delaying the levy of tariffs on imported solar products or extending the delivery period of domestic projects.

　　Earlier in March, the Indian government announced that it would impose a basic tariff (BCD) of 40% on solar modules from April 2022 to reduce dependence on imports and expand the country’s photovoltaic manufacturing base. Recently, the Indian Solar Energy Developers Association wrote to MNRE, saying that it hopes to postpone this tariff for one year. If the opinion is adopted, the effective date of India’s basic tariff on solar modules will be postponed to 2023.

　　In addition, at the end of September, India also terminated the safeguard measures for imports of photovoltaic cells and modules. In mid-July last year, India proposed to impose a one-year safeguard tax on imported photovoltaic cells and modules, of which 14.90% ad valorem tax was levied in the first six months and 14.50% ad valorem tax was levied in the following six months. The levy applies to the products involved in China, Thailand and Vietnam.

　　The Indian government made such adjustments mainly because of the recent continuous decline in China's solar products. India's solar energy products mainly rely on imports, so the recent solar projects in India have been greatly affected.

　　The Indian Developers Association wrote to the Ministry of New Energy and Renewable Energy (MNRE), stating that due to the approaching project deadline and the rise in imported solar products, Indian independent power producers will pay more than 1.5 times the original contract. As the solar project contract did not take into account the increase in module costs, the price increase will have to be fully borne by the company.

　　As a widely optimistic photovoltaic clean energy, India is too dependent on imports. In the first half of this year, India's imports of solar cells and modules have soared 10 times, reaching a total of 762 million US dollars. Although the Indian government prefers to adopt domestic products, because of India's weak manufacturing capacity, its production capacity and quality are far from being able to meet the rapidly growing domestic demand.

　　The Indian government has actually introduced a lot of incentive policies, which has greatly increased the capital market’s investment in clean energy. For example, Reliance Industries, a subsidiary of India's richest man, has frequently spent huge sums of money to build solar production bases on a large scale. Including the announcement at the end of June that it will invest 8.1 billion U.S. dollars to build giant factories for solar energy, energy storage, electrolyzers and fuel cells. In October, the company's subsidiary announced the acquisition of REC Solar for US$771 million, and plans to acquire the solar energy company of Indian billionaire Pallonji Mistry.

　　However, India’s current solar manufacturing industry is still weak. At present, about 80% of India’s local solar module demand is imported from other Asian countries such as China, Vietnam and Malaysia. India’s goal is to increase the installed capacity of solar energy by 280GW by 2030.

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