Exports of solar cells and modules from India have gone up to $ 628.38 million in April – July 2023, which is 1,062 per cent higher than $ 54.04 million recorded in the same period of 2022, according to government data. (Cells go into the manufacture of modules.)
Indian manufacturers of solar cells and modules are having a good time, thanks almost entirely to the US market, which has kept the (cheaper) Chinese away due to a variety of reasons. Exports of modules amounted to $616.73 million, while exported standalone cells were worth $11.65 million. The US alone bought $607.69 m worth of modules.
The rise in exports is a windfall of sorts for the Indian manufacturers who are wallowing in the lucrative US market, where China cannot sell due to certain trade barriers.
“The flourishing business in the US market in particular is contributing significantly to the growth of our industry,” says Hitesh Chamanlal Doshi, Chairman and Managing Director of Waree, a leading Indian solar module manufacturer.
Module manufacturersalso enjoy three types of support in the domestic market – PLI, protection by way of 40 per cent basic customs duty and the requirement of approval for modules by the Ministry of New and Renewable Energy, in the form of the ‘Approved List of Models and Manufacturers (ALMM).
This situation has drawn murmurs of protests from the Indian solar energydevelopers who are having to pay 8-9 cents a Watt-peak more in the form of the basic customs duty, even though the Indian manufacturers need no such protection because they are anyway not selling much in India.
Energy developers complain
Srivatsan Iyer, Global CEO, Hero Future Energies, pointing out that the Indian manufacturers enjoy customs duty protection while having no requirement to cater to the Indian market, called the BCD “a bit of a perverse incentive.”
Doshi, while “acknowledging the fact that certain trade barriers brought into place by other nations have given non-Chinese manufacturers an opportunity to export,” observes that the demand for electricity in India is increasing – a demand “best fulfilled by solar power.”
In an emailed response to businessline’s questions, Doshi added that this demand should “ideally be met by domestic manufacturers.” He further noted that “the implementation of PLI could accelerate the process to a considerable extent.”
This would enable domestic players to more effectively compete with overseas manufacturers in terms of costs, he said.
Even as exports of solar modules and cells are rising, imports are going up too. In April – July 2023, India imported cells and modules worth $1.26 billion, compared with $ 711.70 million in the same period last year – a rise of 78.3 per cent. Doshi says imports might touch $4 billion this year, which is significantly higher than exports.
On the BCD, he noted that while India had imposed a 40 per cent duty on imported cells and modules from China, “imports via FTA countries defeat the very purpose of the same.”
India’s solar installations were 72 GW by the end of August, which means they may have well crossed the 75 GW-mark now. The government plans to bid out about 40 GW of solar and wind-solar hybrid capacity each year, for the next five years.