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India needs to act fast on local content for Solar Mission

According to reports, the Ministries of Commerce and Industry and New and Renewable Energy are looking for an early solution that would enable use of more domestic products under the second phase of the Jawaharlal Nehru National Solar Mission without attracting more trouble at the World Trade Organisation.

Official sources told Business Line that MNRE was looking into the concerns expressed by the Commerce & Industry Ministry regarding mandating local sourcing of more products such as thin films and solar cells. The clock is ticking as the second phase of the Solar Mission is to take off from April.

“We have 30 days to respond and another 60 days to hold consultations. We would like to address the concerns raised by the Commerce Ministry,” the official said.

India has already been dragged by the US to the WTO over phase I of the Mission that mandates local sourcing of the solar modules.

A cautious Commerce Ministry had expressed reservations on the draft circulated by MNRE proposing to expand local sourcing to more products under the second phase. In fact, the Commerce Ministry is peeved with the MNRE for not consulting it during phase I.

India and the US are already in consultations at the WTO over the ongoing dispute.

In fact, officials of the two Ministries have been holding meetings daily, over stance that will reflect the Government’s position, official sources said.

Besides, at the WTO, it is the Commerce Ministry which will take the lead.

MNRE has defended the local content on the grounds that this was Government procurement which is allowed as India is not governed by the Government Procurement Act of the WTO.

But, the Commerce Ministry is apprehensive of questions being raised since the power ultimately will be sold to private consumers and is not limited to Government use. WTO requirement allows domestic sourcing strictly for Government use.

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