Anti-dumping duties to raise solar project costs by 18-75%, says India Chamber of Commerce

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The Associated Chamber of Commerce and Industry of India (ASSOCHAM) has written a letter to India’s Ministry of Finance stating project costs would inflate by as much as 75% if anti-dumping duties are introduced. 

The letter, published last week, stated that if anti-dumping duties are imposed on 22 August, a minimum increase in project costs of 18.83%, to a maximum of a 75% price increase can be expected.

The letter was weeks after the ASSOCHAM founder and CEO, Shri Rana Kapoor, was called to form part of the Ministry of Finance’s trade and industry pre budget consultation, 6 June this year.

The duties would increase overall solar costs “negating all the efforts made so far”.

ASSOCHAM’s letter claims that the momentum built by the national solar mission, and solar schemes so far, are set to bring solar generation prices to grid parity by 2017, but the implementation of anti-dumping duties would delay solar prices from reaching parity and in turn threaten energy security and accessibility.

The ASSOCHAM letter then says the current solar tariff of INR7.73 per kWh (US$0.12) would increase to between a minimum of 9.1 per KWh (US$0.14), to as much as INR13.51 per kWh (US$0.22) if duties are introduced.

Secretary general of ASSOCHAM, D.S. Rawat said that with 17GW of solar capacity still to be installed, out of the 20GW by 2022 national solar mission target, an anti-dumping charge would increase project costs by INR22,120 crore (US$3.6 billion) – to INR87,500 crore (US$14.3 billion).

ASSOCHAM also said in the letter that anti-dumping duties would result in “cost hikes” for distribution companies, or the government will bear the price increase, and a subsequent hike in energy bills for consumers in India.

Local developer, Welspun, US manufacturer, First Solar and  analysts, Bridge to India have argued against duties raising concerns over the abilities of local cell and modules manufacturers to meet demand. They also claim punitive duties are at odds with the new prime minister Narendra Modi’s solar goals. Local manufacturers including Tata Power, have argued for the duties.

The proposed anti-dumping duties would affect US, Chinese and Malaysian solar manufacturers. Chinese firms face duties as high as US$0.81/W.

Thin-film manufacturer First Solar, which has made ground in the Indian market, will face US$0.11/W duties. US silicon-based panels will be subject to US$0.48/W duties.

Malaysian manufacturers will face duties of US$0.62/W and Taiwanese firms US$0.59/W.

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