Lok Sabha Question No. 3903 (UNSTARRED), answered on 2018-08-09
Subject: Domestic Solar Power Industry
Ministry: NEW AND RENEWABLE ENERGY
Asked by: ASHOK SHANKARRAO CHAVAN, SUDHEER GUPTA, GAJANAN CHANDRAKANT KIRTIKAR, VIJAY KUMAR S.R., KUNWAR HARIBANSH SINGH, T. RADHAKRISHNAN, S. RAJENDRAN, BIDYUT BARAN MAHATO

## GOVERNMENT OF INDIA MINISTRY OF NEW AND RENEWABLE ENERGY

## LOK SABHA UNSTARRED QUESTION NO-3903

TO BE ANSWERED ON-09.08.2018

## DOMESTIC SOLAR POWER INDUSTRY

3903. SHRI ASHOK SHANKARRAO CHAVAN SHRI SUDHEER GUPTA SHRI GAJANAN KIRTIKAR SHRI S.R. VIJAYAKUMAR KUNWAR HARIBANSH SINGH SHRI T. RADHAKRISHNAN SHRI S. RAJENDRAN SHRI BIDYUT BARAN MAHATO

Will the Minister of NEW AND RENEWABLE ENERGY be pleased to state:-

- (a) whether the country has achieved a record low solar power tariff per unit in the country and if so, the details thereof;
- (b)  whether  the  country's  domestic  solar  industry  has  suffered  serious  injury,  considering overall performance such as market share and profitability in the recent years;
- (c)  if  so,  the  details  thereof  and  the  reasons  therefor  along  with  the  corrective  measures taken/being taken by the Government in this regard;
- (d)  whether  the  Government  has  imposed  duty  for  two  years  on  solar  cells  and  modules imported from China and Malaysia recently and if so, the details thereof;
- (e)  whether  the  Government  has  taken  any  measures  to  ensure  that  the  domestic  solar industry is not affected by the increase in solar power tariffs due to imposition of duty and if so, the details thereof; and
- (f)  the  steps  taken/being  taken  by  the  Government  to  produce  solar  cells  and  modules  at cheaper rates in the country?

## ANSWER

THE MINISTER OF STATE FOR NEW & RENEWABLE ENERGY AND POWER (I/C) (SHRI R.K. SINGH)

- (a)  Solar  tariffs  in  India  saw  the  lowest  ever  level  of  Rs.2.44  per  unit  in  reverse  auctions carried out by Solar Energy Corporation of India (SECI) in May 2017 for 200 MW and again twice in July, 2018, for 600 MW in each instance.

(b), (c) & (d) As per the final findings dated 16 th July, 2018,  in the investigations concerning imposition of Safeguard duty on import of solar cells and modules, Directorate General of Trade  Remedies  (DGTR)  has  concluded  that:  'The  domestic  industry  has  suffered  serious injury, considering overall performance, on the basis of listed economic parameters such as market share and profitability, which have sharply declined over the injury period 2014-2015 to 2017-2018 (Annualised) whereas market share of imports have increased during the same period. This has caused significant overall impairment to the domestic industry.'

Based  on  the  final  findings  of  DGTR,  the  Government,  through  notification  no.  01/2018Customs (SG) dated 30 th July, 2018, have imposed Safeguard duty on import of solar cells whether or not assembled in  modules or panels, as follows:

i. twenty five percent. ad valorem minus anti-dumping duty payable, if any, when imported during the period from 30 th July, 2018 to 29 th July, 2019 (both days inclusive);

ii.  twenty  percent.  ad  valorem  minus  anti-dumping  duty  payable,  if  any,  when  imported during the period from 30 th July, 2019 to 29 th January, 2020 (both days inclusive);

iii.  fifteen  percent.  ad  valorem  minus  anti-dumping  duty  payable,  if  any,  when  imported during the period from 30 th January, 2020 to 29 th July, 2020 (both days inclusive);

Nothing contained in the notification dated 30 th July, 2018, mentioned above shall apply to imports of subject goods from countries notified as developing countries vide notification no. 19/2016-Customs (N.T.) dated 5 th February, 2016, except China PR, and Malaysia.

(e) The 'Guidelines for Tariff Based Competitive Bidding Process for Procurement of Power from Grid Connected Solar PV Power Projects' notified on 3 rd August, 2017, provides under the clause 5.7 'Change in Law', that 'In the event a Change in Law results in any adverse financial loss/ gain to the Solar Power Generator then, in order to ensure that the Solar Power Generator is placed in the same financial position as it would have been had it not been for the occurrence of the Change in Law, the Solar Power Generator/ Procurer shall be entitled to compensation by the other party …………' The Government, through a clarification dated 2 nd April, 2018, to the above referred Guidelines, has clarified that the term 'change in the rates  of  any  taxes'  as  mentioned  in  clause  pertaining  to  'Change  in  Law'  of  the  said Guidelines includes "change in rates of taxes, duties and cess."

(f)  Domestic  manufacturing  of  solar  cells  and  modules  in  India  is  being  supported  by  the Government of India through Modified Special Incentive Package Scheme (M-SIPS) of the Ministry of Electronics & Information Technology. The scheme, inter alia, provides for:

i. 20-25% subsidy for investments in capital expenditure for setting up of the manufacturing facility.

ii. Reimbursement of counter vailing Duty (CVD)/ Excise Duty for capital equipment for the units outside Special Economic Zone (SEZ).

Further, the solar power projects being implemented by the Central Public Sector Undertakings (CPSUs) with financial support from the Government and those rooftop solar projects which are implemented with central financial assistance are mandated to source their requirement of solar cells & modules from domestic sources as per extant Guidelines, in a World Trade Organization (WTO) compliant manner.