New Delhi: India plans to support local solar cells and modules makers by assuring contracts for government projects, a note from the renewable energy ministry said, as it looks to scale up manufacturing to cut Chinese imports and avoid legal hassles.
The United States is due to take India back to the World Trade Organization (WTO) next month to settle a long-standing solar power dispute, alleging that India has failed to comply with last year's ruling related to giving preference to local solar equipment makers.
The new proposal to scale up DCR requirements in government projects with a capacity of 12 gigawatts (GW) aims to protect India's solar equipment makers facing financial collapse.
Under the policy, India will also provide direct financial support of 110 billion rupees ($1.72 billion) to domestic solar cell and module manufacturers, in addition to subsidies, cheap loans and an exemption of goods required for setting up solar equipment making facilities from customs duty.
Chinese companies have gained the most from the increase, accounting for around 85 percent of India's solar module demand and earning around $2 billion, according to industry data, even as local companies such as Indosolar Ltd and Moser Baer India Ltd are struggling to win contracts.
To address such challenges, the government also plans to create a fund to support technological upgrades and cheaper land and electricity. Manufacturing units would also be allowed to set up power plants with twice the capacity of their module units, according to the note.
The United States is due to take India back to the World Trade Organization (WTO) next month to settle a long-standing solar power dispute, alleging that India has failed to comply with last year's ruling related to giving preference to local solar equipment makers.
The new proposal to scale up DCR requirements in government projects with a capacity of 12 gigawatts (GW) aims to protect India's solar equipment makers facing financial collapse.
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Under the policy, India will also provide direct financial support of 110 billion rupees ($1.72 billion) to domestic solar cell and module manufacturers, in addition to subsidies, cheap loans and an exemption of goods required for setting up solar equipment making facilities from customs duty.
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Chinese companies have gained the most from the increase, accounting for around 85 percent of India's solar module demand and earning around $2 billion, according to industry data, even as local companies such as Indosolar Ltd and Moser Baer India Ltd are struggling to win contracts.
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To address such challenges, the government also plans to create a fund to support technological upgrades and cheaper land and electricity. Manufacturing units would also be allowed to set up power plants with twice the capacity of their module units, according to the note.
© Thomson Reuters 2017
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