India outlines 20% customs responsibility on solar modules, cells and inverters from August 2020

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India outlines 20% customs duty on solar modules, cells and inverters from August 2020

Image: Flickr / Sanyam Bahga.

Starting in August, India will levy a 20% tax on imported solar modules, cells and inverters, thereby replacing the current protection obligation.

Numerous local reports say the levy was proposed yesterday by Indian Energy Minister RK Singh during a meeting with industry officials to confirm Prime Minister Narendra Modi’s government intended to impose a base tariff of 20% on imports.

This BCD, which is part of the “Make in India” initiative to stimulate domestic production, would replace the existing protection obligation of 15%, which is due to expire on July 29, 2020.

The update serves to confirm the tariffs which were first imposed under the Union budget at the beginning of this year and which at that time did not set a specific timeframe for the introduction of such duties. It also seems to clear up confusion about possible exceptions for components or devices as suggested a month later.

It is also amid a push by the Indian Ministry of New and Renewable Energy to restart domestic renewable energy production after imports struggled with logistical issues resulting from the ongoing COVID-19 pandemic. In May, the government announced that it had identified solar PV manufacturing and advanced battery manufacturing as “champion sectors” of national self-sufficiency and that it would provide incentives to support both.

In addition, RK Singh confirmed that an approved list of PV manufacturers for use in government-sponsored solar projects will be released in October this year, postponed from the original April date following the outbreak of the pandemic.

As expected, the news will deal a blow to the Chinese inverter manufacturers, who dominate the Indian rooftop solar inverter market, research by JMK Research & Analytics showed earlier this year.

Tags: India, Base Duty, Trade Duty, Modules, Cells, Inverters, Protective Duty, Manufacturing, Domestic Content Requirements

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