India Vows to Buy Local Solar Content as Dumping Deadline Passes

India’s power minister asked domestic solar equipment makers to start idled capacities, pledging the government would ensure buyers for their products.

The assurance came as India failed to publicly announce dumping duties by an Aug. 22 deadline on competing U.S. and Asian imports. The levies threatened to stall projects in the region’s third-biggest solar market and escalate a protectionist trade war already under way between the U.S., Europe and China.

“We will ensure domestic manufacturers are taken care of, while not allowing that to become a restricting factor,” for the broader industry, Piyush Goyal told a meeting of solar executives in New Delhi on Aug. 22. “I make a public assurance that the government won’t be found wanting in picking up whatever you produce.”

Cell makers including Indosolar Ltd. and Websol Energy System Ltd. had idled as much as three-quarters of their production as they were unable to compete against cheaper imports. They’d petitioned for the duties, which would have priced out overseas suppliers such as First Solar Inc. and Trina Solar Ltd.

Goyal declined to respond to reporters’ questions about the levies, which were recommended by the commerce ministry in May, ranging from 11 cents to 81 cents per watt on imports from the U.S., China, Taiwan and Malaysia. The finance ministry had until Aug. 22 to decide whether to implement that proposal.

Purchase Promise

Goyal assured local solar manufacturers that the government through state-owned companies, including the largest power generator NTPC Ltd., would buy their output.

NTPC will build at least 1,000 megawatts of solar capacity, Chairman Arup Roy Choudhury said at the same event in Delhi. That could rise to 3,000 megawatts in the next five years, Executive Director A.C. Chaturvedi said. The utility plans to announce an auction for the first 250 megawatts next month, he said.

The finance ministry’s Central Board of Excise and Customs didn’t post a public notice by the Aug. 22 cutoff on its website to implement the dumping duties.

Board spokesman Ajay Kalra refused to comment when called on his mobile phone. The NDTV 24X7 television channel reported yesterday that Finance Minister Arun Jaitley, Goyal and Commerce Minister Nirmala Sitharaman agreed in a meeting to “put off” the levy to avert a crisis in the industry.

The finance ministry doesn’t legally have to publish a notice if it decides to let a dumping recommendation lapse, and the government has probably decided to “close the file” quietly to avoid controversy, said Jagdish Agarwal, a lawyer advising the Solar Independent Power Producers’ Association.

Copyright 2014 Bloomberg

Lead image: Solar panels via Shutterstock

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