New Delhi, May 23: The commerce ministry has proposed an anti-dumping duty on solar cells imported from the US, a move likely to deepen the trade tensions between the two countries, already engaged in a bitter row over New Delhi’s drug patent rules.
Besides the US, duties have been slapped on imports from China, Malaysia and Chinese Taipei.
India’s solar programme had angered the US, which had taken New Delhi to the WTO in February over its rules that limit the use of imported solar equipment.
India’s directorate general of anti-dumping duty and allied duties (DGAD) today recommended duties in the range of $0.11-$0.81 per watt of solar power. The DGAD is part of the commerce ministry.
Chinese products face the highest dumping duty, from $0.64-$0.81 per watt. The levy on US products ranges from $0.11-$0.48 per watt.
The anti-dumping duty was recommended for “solar cells whether or not assembled partially or fully in modules or panels or on glass or some other suitable substrates, originating in or exported from Malaysia, China, Chinese Taipei and USA”, according to the commerce ministry notification.
The DGAD proposals will be vetted by the finance ministry, which has three months to make a final decision, although it rarely rejects the recommendations.
The levy will come as a huge relief to domestic solar cell manufacturers, who have been either forced to shut down operations or are producing below capacity because of competition from cheap imports.
According to the Indian Solar Manufacturers Association (Isma), more than 70 per cent of the installed solar photovoltaic capacity are lying idle in the country and hundreds of employees have been laid off.
The DGAD has also said in its findings that products were being sold below normal value, hurting the domestic industry.
H. R. Gupta, managing director of Indosolar Ltd and member of Isma, said, “India’s solar manufacturing is now bound to revive and further increase with both local and overseas participation ensuring a robust supply chain with benchmarks in technology and costs.”
The DGAD in its report said imports of solar cells from the US, Malaysia, China and Taipei had jumped to 173,015 KW (kilowatt) in 2010-11 from 57,661 KW in 2008-09.
“India will now find it easy to install 50,000 MW of solar energy in grid and off-grid segments, including agriculture, telecom and rural electrification. The country will also benefit from an indigenous supply chain driving industrial growth, improving CAD (current account deficit) and ensuring clean energy security at the most economical costs,” said Pradeep Kheruka, vice-chairman of Borosil Glass Works Ltd and member of Isma.
India and the US had averted a major standoff last month when Washington braved opposition from drug multinationals to keep India out of its dreaded Priority Foreign Country list that invites sanctions for a weak patent regime. The US had said it would continue discussions with the new government for the enforcement of patent rules.
India had vigorously defended its solar programme against the American charges. New Delhi said the programme was WTO-compliant, and the country will defend its stand before the Geneva-based WTO.
Analysts said the US deciqsion to move the WTO was a pre-emptive measure to ensure that orders come to American companies when the larger projects are taken up.