Modi’s first budget clears tax hurdles for India’s solar manufacturers

Facebook
Twitter
LinkedIn
Reddit
Email

Prime Minister Narendra Modi’s first budget has been delivered with a number of tax advantages for the solar industry revealed.

Excise duty will be waived on backsheets and “inputs used in their manufacture”, glass for modules, copper wire for cells and modules and “machinery and equipment required for setting up of a project for solar energy production”.

This article requires Premium SubscriptionBasic (FREE) Subscription

Unlock unlimited access for 12 whole months of distinctive global analysis

Photovoltaics International is now included.

  • Regular insight and analysis of the industry’s biggest developments
  • In-depth interviews with the industry’s leading figures
  • Unlimited digital access to the PV Tech Power journal catalogue
  • Unlimited digital access to the Photovoltaics International journal catalogue
  • Access to more than 1,000 technical papers
  • Discounts on Solar Media’s portfolio of events, in-person and virtual

Or continue reading this article for free

In addition, copper wire and backsheets will be exempt from customs duty while project equipment and machinery will benefit from a concessionary customs rate of 5%.

“We need to maximise our utilisation of solar power. The existing duty structure incentivises imports rather than domestic manufacture of solar photovoltaic cells and modules,” finance minister Arun Jaitley said in his budget statement.

The finance ministry is currently considering the imposition of recommended anti-dumping duties on Chinese, US, Taiwanese and Malaysian cells and modules.

Two ministers have warned the duties will stall project development but manufacturers have warned they are necessary if they are to survive financially beyond the end of the year.

A decision on the duties is due before the end of August.

Some funding for project development was also been announced in the budget. A sum of INR5 billion (US$83.5 million) has been set aside for large-scale project development in five states. Solar water pump installations will benefit from four billion rupees (US$66.8 million) and one billion rupees (US$16.7 million) will be used to install sub-1MW plants along the banks of canals.

The ministry for new and renewable energy (MNRE) has also confirmed that it is coordinating the development of 5GW and 2.5GW solar parks in Jammu & Kashmir (J&K).

A committee of state and central government officials has been formed to press the projects forward.

India’s solar parks cordon off grid-connected, pre-approved sites for the development of PV projects.

Read Next

July 4, 2025
Chinese PV provider Skycorp Solar Group has announced a solar plant acquisition and development strategy following unanimous board approval.
July 4, 2025
Germany’s latest innovation tender has awarded 488MW of co-located capacity, with all the projects being solar PV tied with energy storage.
July 4, 2025
Risen Energy’s mass-produced heterojunction (HJT) modules have reached a cell conversion efficiency of 26.61%, a record figure for the company.
July 4, 2025
The US House of Representatives has passed the final version of the reconciliation bill that is now going to US President Donald Trump’s desk for his signature before its passing.
July 4, 2025
Australian retailer AGL Energy has confirmed its acquisition of South Australia’s Virtual Power Plant (SAVPP) from Tesla.
July 3, 2025
Renewable energy curtailment in Brazil is set to reach 8% across the country, and be as high as 11% in the north-east, by 2035.

Subscribe to Newsletter

Upcoming Events

Media Partners, Solar Media Events
September 2, 2025
Mexico City, Mexico
Solar Media Events
September 16, 2025
Athens, Greece
Solar Media Events
September 22, 2025
Bilbao, Spain
Solar Media Events
September 30, 2025
Seattle, USA
Solar Media Events
October 1, 2025
London, UK