Solar manufacturers ready to expand if govt gives incentives, curbs imports

Indian solar cell and module makers are ready to increase their manufacturing capacity to the tune of 8-15 Gw annually, but want the government to offer them demand surety and restrict Chinese imports.

In a letter to the ministry of new & renewable energy (MNRE), the manufacturing industry is confident that the Centre will provide them supply exclusivity for KUSUM scheme and several projects of central public sector companies.

Leading the manufacturing expansion is Adani Mundra, which is planning to add another 1 Gw of capacity, followed by Jupiter Solar, Premier Solar and others. The current solar cell manufacturing stands at 3 Gw. The short-term plan is to expand current cell manufacturing by 2.5 Gw and to set up another 10-Gw capacity by 2021. The industry plans to add 15 Gw of module manufacturing by the same year.

"Needless to say, the implementation of these plans are subject to continued demand visibility and protection from imports of cells and modules, at dumped price, from China, Taiwan, Malaysia and Vietnam and financial closure with Indian banks," said the letter by Indian Solar Manufacturers Association (ISMA) to R K Singh, minister of state for power and MNRE.

The Indian government announced imposition of safeguards duty for two years – 25 per cent for the coming year, 20 per cent for six months thereafter and 15 per cent after that. The duty would specifically impact the solar panels coming from China, as more than 85 per cent of India's solar capacity is built on Chinese panels. The industry, in a separate petition, has asked the government to consider extending the duty beyond two years.

Meanwhile, the last date of submitting bids for the power plant linked solar manufacturing tender was extended for the eleventh time last week as no bids came from any company. It is for setting up of 6-Gw solar power plants linked with setting up of 2 Gw (per annum) of solar manufacturing plant.

After several extensions due to lack of interest, the central government in January this year decided to cancel the lone bid that came for setting up solar panel manufacturing along with a solar power plant. The single bid came from Azure Power with Waaree Energies. The government re-issued the tender in March, which was also extended again.