Solar module imports to attract 40% duty from April 2022
31 March 2021
Solar cells imported into India will attract customs duty of 20 per cent while imported solar modules will attract duty of up to 40 per cent, beginning 1 April 2022.
The decision follows the recent imposition of a 14.8 per cent safeguard duty on fresh import of solar cells and modules, in order to protect the interest of domestic module manufacturing companies.
The minister of new and renewable energy announced the imposition of a basic customs duty on solar cells and modules which was a major demand by manufacturers for a long time as they wanted a level playing field with the Chinese companies.
The Indian solar power market is dominated by Chinese companies that supply 80 to 90 per cent of all solar modules used by power producers in the country.
While the move may help protect and promote Indian solar cell and module manufacturing companies, this could lead to an increase in solar power tariff bids by project developers.
There have been numerous attempts by domestic manufacturers to get the government to levy import duties on Chinese modules.
However, it was the military skirmishes between the two countries last year that triggered a wave of anti-Chinese sentiment in India. The Indian government launched a massive programme to promote domestic manufacturing in several sectors with a goal to achieve self-sufficiency, solar equipment being one of the sectors.