Impose safeguard duty on solar cells import: ISMA

The Indian Solar Manufacturers Association (ISMA) has demanded imposition of safeguard duty on imports of solar cells and modules, saying it would be significant to the solar manufacturing industry.

The association has written to the Commerce ministry favouring the Directorate General of Safeguards (DGS) recommendation of imposition of 70 per cent duty on imports of solar PV cells and modules.

The DGS is mandated to investigate the existence of "serious injury" or "threat of serious injury" to the domestic industry as a consequence of increased import of an article into India.

It also submitted its findings to the central government along with recommendations regarding the amount and period of levy of safeguard duty to check injury or threat of injury to the domestic industry.

"The consequences of not imposing the recommended duty, and in good time, are very significant not only to the solar manufacturing industry, but also to the nation, considering the strategic nature of solar power to India and perpetuating dependence on China for imports of solar cells and modules," the ISMA's letter said.

It cited ways to check solar power tariff rise, which is expected due to the imposition of the duty.

It is true that the imposition of safeguard duty will increase the prices of cells and modules, inherently because that is the objective of duty imposition, the association said.

"However, we are convinced that safeguard duty will not result in any significant increase in solar power tariff. Additionally duty collected will be a revenue to Indian exchequer and can be redeployed in solar power development," the ISMA said.

Adani Group, Vikram Solar and Tata Power are among the top few domestic solar manufacturers in India. India is targeting to 100 gigawatt (GW) solar capacity by 2022.

Solar cells, electrical devices that convert sunlight directly into electricity, are imported primarily from China, Malaysia, Singapore and Taiwan.

The association said the recommendation for imposition of safeguard duty is not arbitrary but based upon a detailed calculation of costs and injuries to domestic industry.