G/SG/N/7/IND/11  
G/SG/N/8/IND/31  
G/SG/N/11/IND/17  
 
18 January 2018  
(18-0493) Page: 1/7 
 Committee on Safeguards  Original: English  
 
NOTIFICATION UNDER A RTICLE 12.4 OF THE A GREEMENT ON SAFEGUAR DS 
BEFORE TAKING A PROV ISIONAL SAFEGUARD ME ASURE  
REFERRED TO IN ARTIC LE 6 
NOTIFICATION UNDER A RTICLE 12.1(B) OF TH E AGREEMENT ON  
SAFEGUARDS ON FINDIN G A SERIOUS INJURY O R THREAT  
THEREOF CAUSED BY  INCREASED IMPORTS  
NOTIFICATION PURSUANT TO ARTICLE 9, FOOTNOTE 2  
OF THE AGREEMENT ON SAFEGUARDS  
(Solar Cells whether or not assembled in modules or panels)  
INDIA 
The following communication, dated 17 January 2018, is being circulated at the request of the  
delegation of India.  India notifies that there has been a finding of serious injury or threat thereof 
caused by increased imports in continuation to Document No.  G/SG/N/6/IND/44  dated 
3 January  2018.  
 
_______________  
 
 
1  INFORMATION ON WHETH ER THERE IS AN ABSOL UTE INCREASE IN IMPORTS  
The product "Solar Cells whether or not assembled in modules or panels" (hereinafter also referred 
to as the "product under consideration" or "PUC") is being  imported into India from various 
countries including China PR, Malaysia, Sing apore and Taiwan. The major quantity of the PUC is 
being imported from China PR. As seen, the import volumes of the PUC have increased 
from 1,275  MW in 2014 -15 to 9,474 MW in 2017 -18 (Annualized). This is an increase of 643% 
in 2017-18 (Annualized) from th e base year 2014 -15. Thus, there is no doubt that the import 
volumes have increased significantly each year. Moreover, there has been a sudden surge in 
imports volumes during the first six months of 2017 -18 which is 74% of the imports in 2016 -17. 
The incre asing import volumes of the PUC both in absolute terms and per cent. terms during the 
period 2014 -15 to 2017 -18 (Annualized) is indicated in the table below.  
Particulars  Unit 2014 -15 2015 -16 2016 -17 2017 -18 
(up to Sept. 
2017)  2017 -18 
(Annualized)  
Total i mports  MW 1,275  4,186  6,375  4,737  9,474  
% increase in imports 
over previous year  % - 228 52 - 49 
 G/SG/N/7/IND/ 11 • G/SG/N/8/IND/31 • G/SG/N/11/IND/17  
 
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  2   SERIOUS INJURY OR TH REAT THEREOF CAUSED BY INCREASED IMPORTS  
a. Serious injury  
During the period of investigation there is an overall deterioration in the functioning of the 
Domestic Industry (DI). The parameter -wise finding of the serious injury suffered by the DI on 
account of enhanced imports of the product "Solar Cells whether or not assembled in modules or 
panels" is summarized as under:  
 
i. The volume of imports of the PUC have increased and are continuing to increase both in 
absolute and relative terms;  
ii. The DI's market share has declined, whereas the market share of imports has 
increased;  
iii. The increased imports of the PUC have substituted the sales of the  DI;  
iv. While the production of the DI has increased, their capacity utilization has decreased 
significantly;  
v. Despite the increase in domestic demand for the PUC, the capacity utilization remained 
very low;  
vi. The DI are faced with a significant loss of potenti al employment opportunities;  
vii. The productivity per employee of the DI has shown a declining trend;  
viii. The DI are experiencing significant losses;  
ix. The inventories of the PUC have increased within the DI; and  
x. The price undercutting by the imported PUC is positi ve throughout the period of 
investigation.  
b. Threat of Serious injury  
The trend in import volumes strongly suggests that imports of PUC are likely to increase in future 
due to excess capacity in China, export orientation of producers in China and opportu nities lost by 
Chinese producers/exporters in other significant markets like USA and EU which would force such 
producers/exporters to target India. The trend of the deteriorating parameters demonstrated in 
paragraphs below is indicative of the threat of se rious injury continuing in future.  
 
3   EVIDENCE OF SERIOUS INJURY  
a. Share of domestic market:  
 
Despite the rapid expansion in domestic demand, the market share of the DI has decreased; the 
DI had a market share of 13% in 2014 -15 which declined to 7% during  2017-18 (A). During the 
same period, the market share of imports increased from 86% to 90%.  
 
Market Share  2014 -15 2015 -16 2016 -17 2017 -18 
(up to Sept. 2017)  2017 -18 
(Annualized)  
Imports  1,275  
(86%)  4,186  
(94%)  6,375  
(89%)  4,737  
(90%)  9,474  
(90%)  
Domesti c sales by the 
applicants / DI  191 
(13%)  276 
(6%) 457 
(6%) 358 
(7%) 774 
(7%) 
Domestic sales by 
other Indian producers  9 
(1%) 8 
(0%) 325 
(5%) 162 
(3%) 325 
(3%) 
Total domestic sales 
by the DI  200 
(14%)  284 
(6%) 782 
(11%)  520 
(10%)  1,099  
(10%)  
Domestic Dem and 1,476  
(100%)  4,471  
(100%)  7,157  
(100%)  5,257  
(100%)  10,573  
(100%)  G/SG/N/7/IND/11 • G/SG/N/8/IND/31 • G/SG/N/11/IND/17  
 
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  b. Sales:  
The above table also reveals that sales of the domestic producers increased from 200 MW to 
1,099  MW i.e. by 899 MW. However, it is material that while domestic sales increased  by 899 MW, 
imports increased by 8,199 MW. Thus, the increase in imports was more than 9  times that of the 
increase in sales of the DI. Also, as the domestic demand increased from 1,476 MW in 2014 -15 
to 10,573 MW in 2017 -18 (Annualized), it is clear that t he increased imports of the PUC have 
substituted for the domestic production in meeting the domestic demand for the PUC.  
c. Production:  
Production of the DI increased from 237 MW in 2014 -15 to 838 MW in 2017 -18 (Annualized). 
There has also been significant  addition of 1,000 MW to the installed capacity of the DI in 2017 -18 
(Annualized). However, despite this increase in installed capacity in 2017 -18, the production that 
year increased by only 365 MW. Also, while the import volumes of the PUC have increased 
from 1,275 MW in 2014 -15 to 9,474 MW in 2017 -18 (Annualized) i.e., an increase of 643%, 
in comparison the production of DI increased 254% during the same period. This conclusion is 
based on the data in the table below.  
Particulars  Unit 2014 -15 2015 -16 2016 -17 2017 -18 
(Up to Sept. 2017)  2017 -18 
(Annualized)  
Total imports  MW 1,275  4,186  6,375  4,737  9,474  
Production of DI  MW 237 295 473 381 838 
d. Capacity utilisation  
The capacity utilisation of the DI increased from 60% in 2014 -15 to 78% in 2016 -17 but fell down 
to 51% during 2017 -18 (Annualized). Further, in 2017 -18 (Annualized) itself, the production 
capacity was enhanced by 1,000 MW, but only 35% of this additional capacity was actually 
utilised, as shown in the table below. Even otherwise, the p roduction facilities of the DI were 
grossly underutilised during the entire POI. Coupled with the increasing trend of imports of the 
PUC, this low level of capacity utilization is a clear indication of current injury and imminent threat 
of further injury t o the DI.  
Particulars  Unit 2014 -15 2015 -16 2016 -17 2017 -18 
(up to Sept. 
2017)  2017 -18 
(Annualized)  
Installed 
Capacity  MW 392 573 604 727 1,653  
Production 
of DI MW 237 295 473 381 838 
Capacity 
Utilisation  % 60% 52% 78% 53% 51% 
e. Employment:  
The emplo yment generated by the DI has declined despite significant capacity addition. The recent 
entry of one applicant – M/s. Mundra Solar PV Ltd. (MSPVL) in May 2017 - has contributed to the 
overall increase in the total number of employees in the industry as a whole, but this is not 
reflective of the industry trend. In fact, if the number of employees of MSPVL is removed, the 
declining employment in the industry as a whole is evident. Further, as the Domestic Industry 
were and are operating far below their insta lled capacity [as seen at (d) above] there has been a 
significant loss in potential employment opportunities.  
Particulars  2014 -15 2015 -16 2016 -17 2017 -18 
(up to Sept. 2017)  
No. of employees 
excluding MSPVL  
(Indexed)  100 135 128 127 
No. of actual 
employe es 
(Indexed)  100 135 128 460 G/SG/N/7/IND/ 11 • G/SG/N/8/IND/31 • G/SG/N/11/IND/17  
 
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  f. Productivity:  
The trend of production per employee shows a declining trend throughout the period of 
investigation, as evident from the table below. It merits mention that even with the addition of a 
significant number of em ployees by the new entrant MSPVL in May 2017 , the industry production 
did not increase proportionately. Per employee production was 0.316 MW during 2014 -15, which 
fell down to 0.291 MW in 2015 -16. Though this parameter rose to 0.492 MW in 2016 -17, it 
declined again in 2017 -18 to a low of only 0.243 MW. Thus, productivity (production per 
employee) was moving up and down and the current figures indicate a downturn that is likely to 
extend at least in the near future. It is clear that the DI have simply been u nable to utilise their 
installed capacities to optimize productivity.  
Particulars  2014 -15 2015 -16 2016 -17 2017 -18 
(up to Sept. 
2017)  2017 -18 
(Annualized)  
Production of DI 
(MW)  237 295 472 381 838 
No. of employees  749 1014 960 3445 3445 
Productivity per 
employee (MW)  0.316  0.291  0.492  0.221  0.243  
g. Profit/Loss  
The DI have incurred significant losses on domestic sales over the POI. The losses have more than 
doubled during 2017 -18 (Annualized) compared to 2016 -17, i.e. from 155 indexed units to 418 
indexe d units. Also, the Domestic Industry incurred an indexed loss of 418 during 2017 -18 as 
compared to the base year of 2014 -15. Such increase in losses has to be seen in the light of 
contrasting parameters such as the increase in capacity, increase in product ion and increase in 
domestic sales. Further, due to a significant decline in net sales realization, losses have 
compounded during 2017 -18 (up to September, 2017) as compared to 2014 -15. 
Particulars  2014 -15 2015 -16 2016 -17 2017 -18 
(up to Sept. 2017)  2017 -18 
(Annualized)  
Loss in Rs. Lakhs  
(Indexed)  100 351 155 187 418 
Loss in Rs. Watt  
(Indexed)  100 243 65 100 103 
h. Inventory:  
The inventory carried by the DI increased by more than 4 times during the POI, as indicated in the 
table below.  
 
Particulars  2014 -15 2015 -16 2016 -17 2017 -18 
(up to Sept. 2017)  
Closing Inventory  
(Indexed)  100 82 152 411 G/SG/N/7/IND/11 • G/SG/N/8/IND/31 • G/SG/N/11/IND/17  
 
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  i. Price Undercutting:  
There was a significant price undercutting by the imported goods throughout the POI, as borne out 
from the table below. It is evident that the  high level of price undercutting prevented the DI from 
increasing their prices to the break -even level as a result of which they suffered losses.  Unforseen Developments  Particulars  Unit 2014 -15 2015 -16 2016 -17 2017 -18 
(up to Sept. 
2017)  2017 -18 
(Annualize d) 
Landed value of imports  
Solar Cells  Rs./Watt  18.78  18.81  15.42  14.04  14.04  
Solar Modules  Rs./Watt  36.95  36.18  29.20  24.77  24.77  
Net sales realisation of Domestic Industry  
Solar Cells 
(Indexed ) Rs./Watt  100 94 88 62 62 
Solar Modules 
(indexe d) Rs./Watt  100 103 82 92 92 
Price Undercutting  
Solar Cells 
(Indexed)  Rs./Watt  100 83 100 37 37 
Solar Modules 
(Indexed)  Rs./Watt  100 173 121 458 458 
Price undercutting %  
Solar Cells 
(Indexed)  % 100 83 122 49 49 
Solar Modules 
(Indexed)  % 100 176 153 684 684 
 
j. Unforeseen Developments  
It is relevant to note that the DI is continuously suffering serious injury and are facing further 
threat of serious injury. The trend in import volumes strongly suggests that imports of PUC are 
likely to increase in future due to unforeseen developments such as excess capacity in China, 
export orientation of producers in China and opportunities lost by Chinese producers/exporters in 
other significant markets like USA and EU which would force such producers/exporter s to target 
India. With  regard to the current production in China, there is a significant shift in both - its 
direction and volume of export trade  towards  India.  While China's exports to India constituted a 
paltry 1.52% of its total global exports during 2 012, this increased to 21.58% during 2016.  
 
India's bound rates on PUC as per its Schedule of Concessions to the WTO is 0% ad valorem as the 
PUC is covered under Attachment A, Section 1 of the ITA -1. The ITA -1 mandated elimination of 
Customs duties and ot her duties / charges of any kind within the meaning of Article II:1(b) of 
GATT 1994 on the products listed therein. Since India is a signatory to ITA -1, the imports of PUC 
are free of Customs duties. Therefore, ITA -1 binds India's freedom of action  with re spect to the 
imported PUC and prevents it from taking other WTO -consistent measures, such as increasing the 
Customs duties. It may be seen that due to this effect of 'Free' imports of the PUC, the present 
circumstances and market conditions has actually re sulted in an increase of imports in a sudden, 
sharp, significant manner into India.  
 
Hence, it is clear that as a result of unforeseen developments and as an effect of obligations under 
GATT including tariff concessions, imports of the PUC has increased in  a sudden, sharp, significant 
manner into India.  
 
4   PRODUCT INVOLVED  
The Product under Consideration (PUC) is "Solar Cells whether or not assembled in modules or 
panels" classifiable under Tariff Heading 8541 and Tariff Item 85414011 of the Customs Tariff 
Act, 1975. The  two major technology available for manufacturing the PUC (1) Crystalline 
Silicon(c -Si) based which can also be referred as silicon wafer based technology and it further 
includes n -type, p -type silicon, and mono and multi crystalline silicon m aterials and (2) Thin Film 
Technology wherein amorphous silicon, cadmium tellurium (CdTe) or copper indium gallium 
selenium are used as semiconductor materials. Both c -Si technology and Thin Film Technology are 
imported into India.  G/SG/N/7/IND/ 11 • G/SG/N/8/IND/31 • G/SG/N/11/IND/17  
 
- 6 - 
 
  In addition, the applica nts are indulged into manufacturing of solar cells using c -Si technology, 
which are like and directly competitive article to imported solar cells originating from the use of 
either c -Si technology or thin film Technology. Thus DI claim that their collectiv e production is 
more than 50% of total production of PUC in India.  
5   PRECISE DESCRIPTION OF THE PROPOSED MEAS URE 
DG Safeguards, the competent authority, has recommended to impose provisional safeguard duty 
at the rate of 70% ad valorem  for 200 days on "Sola r Cells whether or not assembled in modules 
or panels".  
6  FURTHER INFORMATION    
The Preliminary Findings were published in gazette of India on 5 January 2018.  
 
7  PROPOSED DATE OF IMP OSITION OF SAFEGUARD  MEASURE  
The safeguard measure will be applicable from the  date of issue of notification in this regard by the 
department of revenue, Ministry of Finance, Government of India.  
 
_______________  
 
 G/SG/N/7/IND/11 • G/SG/N/8/IND/31 • G/SG/N/11/IND/17  
 
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  NOTIFICATION PURSUANT TO ARTICLE 9, FOOTNOTE 2,  
OF THE AGREEMENT ON SAFEGUARDS  
 
 
1  SPECIFY THE MEASURE  
DG Safeguards, th e competent authority, has recommended to impose provisional safeguard duty 
at the rate of 70% ad valorem for 200 days on "Solar Cells whether or not assembled in modules 
or panels"  
 
2  SPECIFY THE PRODUCT SUBJECT TO THE MEASU RE 
The Product under Consideratio n (PUC) is "Solar Cells whether or not assembled in modules or 
panels" classifiable under Tariff Heading 8541 and Tariff Item 85414011 of the Customs Tariff 
Act, 1975.  
 
3  SPECIFY THE DEVELOPI NG COUNTRIES TO WHIC H THE MEASURE IS NOT  APPLIED 
UNDER ARTICLE 9.1 OF THE AGREEMENT ON SAFEGUARDS, AND THE IMPORT SHARE OF 
THESE COUNTRIES INDI VIDUALLY AND COLLECT IVELY  
As the imports from developing nations, as listed in Notification No.19/2016 -Customs (NT)1 
dated  5 February 2016, except China PR and Malaysia do not exce ed 3% individually and 9% 
collectively, the import of product under consideration originating from developing nations except 
China PR and Malaysia will not attract Safeguard Duty in terms of proviso to Section 8B (1) of the 
Customs Tariff Act, 1975.  
 
_____ _____  
                                                
1 A copy of t he Notification No.19/2016 -Customs (NT) has been submitted electronically . To consult this 
document please contact Ms. Budd (hilary.budd@wto.org) or Ms.  Naville (delphine.naville@wto.org) of 
the Rules Division.