To promote the local manufacturing units India’s new budget tripled the import duty to 15% on solar lanterns & 20% on solar inverters. The off-grid solar industry already experienced a 10% decline in solar lanterns sales in 2019-20, now it tends to down more.

The off-grid industry is seeking domestic quality product production to fill the gap on the shortfall created due to price hikes.

“We understand that the increase in duties has the undesirable effect of making certain products in the market expensive for end-customers,” said Piyush Mathur, board member of CLEAN, a trade group representing over 200 distributed renewable energy companies. “However, the new duty structure also offers our member companies an opportunity to build and scale their local manufacturing to a globally competitive standard.”

Mathur said, the new customs duty “appears to run against the national imperative to accelerate clean energy adoption,” but ultimately, tax concessions and manufacturing incentives offered by Make in India point to a future of greater self-reliance through local manufacturing.

India largely depends on the import of solar products from China. Based on the stats provided by the Ministry of Commerce, more than 95% of solar lanterns sold in India were imported in the previous year.

Indian manufacturers picking up these opportunities to scale up the production. Fulfilling the demand of the market generated from the hiked prices is the major issue.

A gap exists in local manufacturing of high-quality products and also the availability of a healthy supporting ecosystem of Indian companies to build sales channels, consumer demand, after-sales service, and marketing, experts say.

Source:- Economic Times