According to reports, India may recommend duties on U.S. and Chinese solar imports after finding evidence of dumping, broadening a global trade dispute in the $130 billion market.
More than 20 overseas suppliers, including First Solar Inc. and Yingli Green Energy Holding (YGE:US) Co., sold equipment in India for as little as half the cost as in their home markets and undercut local prices by as much as a third, according to a summary of a 1 1/2 year probe by the Ministry of Commerce & Industry sent to the parties involved yesterday and obtained by Bloomberg News.
The document indicates the ministry will recommend duties on imports from the U.S., China, Taiwan and Malaysia, said Jagdish Agarwal, spokesman for the Solar Independent Power Producers Association, which opposes tariffs.
If Asia’s third-biggest solar market imposes duties, it would escalate a protectionist trend that’s threatening the viability of projects as they compete against conventional power sources. The U.S. applied tariffs as high as 250 percent on Chinese products in 2012, and the European Union followed with its own measures a year later. Australia today announced a dumping probe.
India, which had virtually no solar power in 2010, has built $10 billion of projects and driven down the cost of generation by half, making it cheaper today than grid power in Delhi and Mumbai. Tariffs will derail that trajectory, making solar power more expensive and causing projects to fail, said Vinay Rustagi, joint managing director of Bridge to India Energy Pvt., a New Delhi-based consulting company.
“It will make most large-scale projects, currently developed on wafer-thin margins, unviable,” Rustagi said. Developers, who depend on imports for 90 percent of panels, could back out of projects, government programs may be scrapped, and India could set itself back two years on its goal to make solar competitive with conventional power, he said.