India starts collecting 25% safeguard duty on solar imports

The Indian government has instructed customs authorities in the country to start collecting the previously set safeguard duties on imported solar cells and modules, it was announced last week.

This move by the Ministry of Finance comes a few days after India’s Supreme Court invalidated a stay order on the imposition of the 25% tariffs. Following the instruction, the provisional assessment has to be finalised and a safeguard duty shall be collected in line with an earlier notification from July when the duty was levied. Customs officials were so far instructed not to insist on the payment.

Only imports of solar photovoltaic (PV) cells and modules from China and Malaysia face duties, while other developing nations are exempt from them. The plan is for the 25% duty to be in effect between July 2018 and July 2019 and then be reduced to 20% for a six-month period. Then it will fall to 15% in the final six-month period ending on July 29, 2020.

Consultancy Mercom Capital estimates in its quarterly solar market update, released last month, that India’s PV market will witness a drop in 2018 installations to 8.3 GW. As the tender activity has slowed down after the safeguard duty was announced, Mercom CEO and co-founder Raj Prabhu forecast that solar installations in 2019 are to remain flat.

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