DGS for 70% duty on Chinese solar imports

The DGS has not suggested any duty on the imports of these from the US and EU, citing low numbers

The Directorate General of Safeguards Duty (DGS) has suggested a safeguard duty of 70 per cent on imports of solar cells (assembled in modules or panels) from China.

In its preliminary report investigating the dumping of solar cells, the DGS said there was “serious injury” to the domestic industry due to increasing imports and declining prices of Chinese solar panels. “I recommend that, pending a final determination, … a provisional safeguard duty be imposed at the rate of 70 per cent ad valorem on the imports of the PUC (solar cells),” said the preliminary report.

The DGS has not suggested any duty on the imports of these from the US and the EU, citing low numbers. The suggested duty was based on a submission made by the domestic industry and would be subject to further investigation and approval from finance ministry. If approved, this might increase the cost of solar panels, which in the past two years has helped bring down solar power tariffs.

A fall of 80 per cent in the tariff in the past six years was supported by declining price of imported panels, from ~18.7/watt in 2014-15 to ~14.04/watt in the current year. The domestic sector has, however, maintained that prices were below cost realisation and the indigenous industry suffered losses to match these.

The investigation was in response to an application by the Indian Solar Manufacturers’ Association (ISMA), which has pleaded the imports led to considerable damage to the indigenous sector. It said around 80 per cent of the market has been taken away by the imports.

The DGS has also observed that while China’s import growth slowed in other countries, it increased considerably in India. The reasons cited were duties imposed by the EU and the US on Chinese solar imports and a sudden surge in India’s demand due to revision of solar capacity addition of 100 GW by 2022.

This is Indian panel-makers second attempt for anti-dumping duty. The first case was filed in 2012 against the US, EU, China, Malaysia and Taiwan.

While the DGAD finalised duties of $0.48 per unit to $0.81 per unit on the solar cells & modules imported from these countries, the ministry of finance did not impose these and let the duty lapse in May last year.