Solar manufacturers seek pass-through of planned basic customs duty

Though the government’s recent announcement of imposing a basic customs duty (BCD) on the import of solar panels intends to benefit the Make in India programme, industry players pointed that as long as the plant developers are allowed to passed through the increased costs by raising tariffs, domestic players would remain shunned as renewable energy companies would have no incentive to procure locally made equipment. Sector veterans said that even after a 25% safeguard duty on import of solar panels in July 2018, about 50% of the domestic manufacturing capacity currently remain unutilised.

The future of domestic solar manufacturers look more ominous because module prices globally are expected to trend further down amid weak demand post-pandemic, giving solar plant owners lesser reason to turn towards the local industry.