In order to "prevent the erosion of India's domestic solar industry base", on July 16, local time, India's PV security measures were finalized. According to the official website of the General Administration of Trade Relief of India (DGTR), the General Administration of Trade Relief recommends a two-year safeguards tax on imported battery chips and components. The tax rate is 25% in the first year, 20% in the first half of the following year, and 15% in the second half of the following year. . Since developing countries other than China and Malaysia alone do not exceed 3% of India's total imports, the total exports to India do not exceed 9% of India's total imports, so they can be exempted, such as Thailand, Vietnam, and the Philippines.
In 2017, China is India's largest supplier of photovoltaic modules, and India is also China's largest overseas market. Last year, China's total exports to India reached 9.46GW (1GW = 1000MW), accounting for about 25% of total exports. As of now, the safeguards tax has not yet been formally levied and must be implemented after the Standing Board agrees and the Indian Ministry of Finance issues a taxation order. If implemented, the safeguards tax will undoubtedly become a double-edged sword, which will be a blow to both Chinese exporters and Indian installers and importers.
India has ambitious solar development goals and plans to reach 100 GW by 2022. But as of the end of last year, the country's cumulative PV installed capacity is only about 20GW, still far from Modi's ambitious goals. In contrast, due to the relatively backward development of the local manufacturing industry, India's domestic domestic demand supply is insufficient, and the completion of the above-mentioned installation plan requires the use of international production capacity.
According to PVInvoLink data, the existing battery capacity in India, combined with the capacity of Vietnam and Thailand, which are not affected by Indian safeguards, is still far below the total demand for more than 10GW components per year. On the contrary, the implementation of defensive tariffs may only bring about the cost of high power station construction or the negative efficiency of component efficiency for the Indian market.
"Two-year target taxation, first of all, is to protect the survival and development of Indian companies. This is not a market-based approach, it is a relatively selfish behavior." Zhang Sen, secretary general of the Solar Energy Products Branch of China Chamber of Commerce for Import and Export of Mechanical and Electrical Products (www.thepaper.cn) said. The Electromechanical Chamber of Commerce has actively organized Chinese PV companies to respond to and defend against the US, EU, Turkey, Australia and other PV products. According to Zhang Sen, the Indian safeguard measures investigation proposed a final ruling and a ruling on the tax rate. However, whether it is a vacant period that has not yet been levied or assuming taxation in the future, China can negotiate and negotiate under the leadership of the Chinese Ministry of Commerce.
“In the meantime, we will also organize domestic companies and importers from India to lobby the local government. India has strong product demand and ambitious new energy development goals, and it needs cheap and high-quality PV modules in China.” Zhang Sen believes that For Indian importers, the safeguards tax has virtually increased the cost of building photovoltaic power plants, which will have an adverse impact on the overall development of the Indian PV industry.
In India, due to the additional cost, the PV security measures have been questioned, which is called “very harmful” and “self-defeating” for project developers.
India’s investigation into safeguards for imported PV products began in December 2017. On December 19, local time, the Indian Ministry of Finance issued a notice to initiate a safeguard investigation on solar photovoltaic products (including crystalline silicon cells and components and thin-film batteries and components) entering India based on the application of the Indian Photovoltaic Manufacturers Association. China immediately launched a defense. The Trade Relief and Investigation Bureau of the Ministry of Commerce announced on December 22 last year that all stakeholders submitted their comments to the investigation authority within 30 days from the date of filing the case. The Chamber of Commerce for Electromechanical and Mechanical Affairs held a response counseling meeting on December 27 of that year and organized 56 companies to conduct a defense-free defense.
On January 5 this year, the Indian side made the preliminary ruling of the case. The General Directorate of Safeguards of India proposed a temporary measure to the Central Government of India, which imposed a 70% ad valorem tax on solar photovoltaic products entering India as a temporary safeguard measure. 200 days.
Historically, India has repeatedly claimed to reverse the import of photovoltaic products. On November 23, 2012, the Indian Anti-Dumping Authority announced that it had filed an anti-dumping investigation against solar cells from mainland China, Chinese Taipei, Malaysia and the United States, based on the application of the Indian Solar Manufacturers Association. On May 22, 2014, the Ministry of Commerce and Industry of India issued a final ruling on the case and proposed an anti-dumping duty of US$0.11 to US$0.81 per watt. In the end, the Indian Ministry of Finance chose not to implement the Indian Ministry of Commerce and Industry's ruling. This time India's anti-dumping and countervailing investigations against Chinese PV companies were closed without tax. In July 2017, the Anti-Dumping Bureau of the Ministry of Commerce and Industry of India issued an announcement stating that it should initiate anti-dumping investigations on photovoltaic cells and components imported from China, Taiwan and Malaysia in response to its domestic industry application. In March of this year, the Ministry of Commerce and Industry of India issued an announcement to decide to terminate the above anti-dumping investigation.
After the introduction of China's "531" photovoltaic new policy focusing on "limited size, power cuts, and subsidies", domestic demand fell, and demand for overseas markets by PV companies increased significantly. The safeguards tax proposed by India poses another challenge to the development of domestic PV companies. In this regard, Zhang Sen suggested that in the future, China's PV companies and China's overseas construction companies will go out to the sea to jointly develop the “Belt and Road”, Latin America, Africa and other light resources, market prospects, and strong demand for PV. The market seeks breakthroughs in diversified markets with diversified PV products.