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US under secy presses India to lift trade barriers in solar

According to reports, though India, with its plan to produce 20gw solar energy by 2022, has business potential for US-based companies, US is troubled by a trend toward mandating local production in key high technology areas as this is obstructing the US from seizing the opportunities, said Francisco Sanchez, its under secretary.

“We urge India not to expand its manufacturing base through measures like local content requirements and mandatory technology transfer requirements,” he said. The renewable energy market in India is estimated to be worth over $17 billion dollars, and is growing at an annual rate of 15 per cent.

“The history of renewable energy is clear. When countries create unnecessary barriers, they may benefit in the short-term, but their consumers are eventually deprived of world’s most cutting-edge technology,” said the official, who addressed the industry event Solarcon 2011 and also the second annual Growth in Emerging Sectors conference in Hyderabad.

In the United States, for example, its tax incentives are open to both foreign-flagged and domestic. Today, 96 per cent of the global wind turbine market is captured by firms that have at least some manufacturing capacity in the United States. These firms have created jobs across the country. These companies were not mandated to open facilities in the United States, the official said.

Citing a trade group report, he said the world’s installed capacity of solar PV jumped from 1.5 gigawatt in 2000 to nearly 40 in 2010, an increase of more than 2,500 per cent.

The bilateral trade between India and the US has been $ 49 billion last year and its total foreign investments in India were $ 27 billion. The US would explore possibilities to work with partners in new sectors and in areas beyond the big cities, said Sanchez, who is now leading an US delegation –the fifth trade mission to India in the last ten months.

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