The Director-General of Trade and Remedies (DGTR) has recommended extending the prevalent Safeguard duty on imported Solar cells for an additional one more year. The extension has been recommended with a revision in tariff at 14.90% for the first six months and then 14.50% for the subsequent six months. As in effect currently, the duty is charged at 15% for solar panels imported from China and Malaysia.
Background of the Safeguard Duty
On 30th July 2018, a 25% safeguard duty was imposed on all the solar cells and modules imported from China and Malaysia. The duty as per the schedule was revised at 15% for the year 2019~20. The imposition of the duty was backed with a need to protect the domestic industry as over 80% of the solar modules used in India were imported from these countries. The duty is slated to expire on 31st July 2020.
The Reason of Extension of the Duty
In a review conducted by the DGTR in March 2020, it was stated that while the duty has improved the position of the domestic industry in the last two years, there is still need for some support. And a one-year extension will be adequate for the same. The review was done following an application submitted by the Indian Solar Manufacturers Association (ISMA) seeking to extend by another four years.
Impact of the Duty on the Consumers and MYSUN’s take on it
The safeguard duty has always seemed to draw conflicting opinions. While it is implemented with the vision to sustain domestic players, it increases the cost of solar systems. This reduces the benefits to the end consumers. We hope that this extension in duty will bring good in the long run.