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Domestic solar equipment majors comprising nearly half of India’s manufacturing capacity are seeking an exemption from the levy of Basic Customs Duty on their projects within Special Economic Zones.
The Centre had proposed the levy of a 20 per cent basic custom duty on import of solar cells and modules. This levy is expected to kick in after the safeguard duty on solar imports lapses in July .
Manufacturers that have their projects within Special Economic Zones (SEZs) fear that this 20 per cent duty will be applicable on them and may render their products uncompetitive within the domestic market.
“These manufacturing units are on Indian soil and there should be no additional levies on them as it will affect the viability of these projects. Our expansion plans also require clarity on this point before going ahead,” a domestic solar equipment manufacturer said during a webinar on this issue.
According to industry estimates, there are 2000 MW of solar cell manufacturing and 3,825 MW of solar module manufacturing capability in SEZs. Within the Domestic Tariff Areas (DTAs), there is 1,164 MW of solar cell manufacturing and 5,053 MW of solar module manufacturing capability.
The domestic manufacturing capacity in the country is much lower than the requirement for cells and modules in the country. Nearly 90 per cent of solar deployment is still dependent on imported cells and modules.
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