The DGTR has recommended a 25 per cent safeguard duty on solar cell and module imports from China and Malaysia for the first year. In the first six months of the second year, a 20 per cent safeguard duty will applicable which will be reduced to 15 per cent in the second half of the year. In addition, DGTR has recommended that no duty should be levied on solar imports from other developing countries as the total share of their module and cell imports is very low.
According to DGTR findings, there has been a significant increase in solar cell and module imports over the investigation period, causing a serious injury to the domestic manufacturing industry’s market share and profitability. In addition, the Indian manufacturers have demonstrated that this sudden rise in solar imports was unforeseen in the context of Article XIX of General Agreement on Tariffs and Trade (GATT). The DGTR has also acknowledged the fact that a rise in tariffs due to the levy of safeguard duty would impact the solar developers and consumers.
According to DGTR, the imposition of safeguard duty would be in public interest to prevent a complete erosion of Indian solar manufacturing industry and to prevent undue escalation of solar power tariffs to the final customer. This balance would ensure that and the 100 GW solar capacity deployment by 2022 is not affected.
The findings and recommendations will be assessed by a board of secretaries from MNRE, Ministry of Power, Ministry of Commerce, Department of Industrial Policy & Promotion, Revenue, Labor and Agriculture. The Ministry of Finance will then issue a gazette for the implementation of the final recommendations from the board of secretaries.