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India is going through a solar power boom. A combination of government targets and steeply falling prices have meant developers are falling over themselves to build huge new solar farms across the country. Last year, one developer set a new record for how cheaply it was willing to build a farm in Rajastan. The problem is that the panel manufacturers like this one, IB Solar, just outside Delhi, have not seen their order book swell quite as rapidly.
They are facing competition from across the border in China where manufacturers are selling their goods off very cheaply, because they've simply made too much for their own domestic market. In the last four years, Indian domestic solar manufacturers have gone from making 246 megawatts of capacity every year to over 500. But in the same period of time, imports have increased from 1,275 megawatts every year to nearly 10,000.
The reason is simple, price. If a developer wants to buy an Indian-made solar panel, it's going to cost them around 62 rupees per watt of capacity. If they want to buy the same panel from China, it'll cost them closer to 25. Already the US and the EU have taken action, imposing anti-dumping duties against Chinese companies for what they say is selling at below cost price. Now India is proposing to do the same thing, planning an emergency 70% tariff on almost all of its solar panel imports, including those from China.
The plan is controversial. Developers say it will push up power prices, and make them less likely to bid for contracts in the future. Smaller manufacturers, like this one, say that by including raw materials under the tariff, it will make panels like this also more expensive. But the largest manufacturers are happy. They say that if the government wants to protect Indian jobs and manufacturing it needs to take action and soon. Kiran Stacey, Financial Times, Delhi.
