Solar Industry : Yearly Review
lubi solar       May 10, 2019
Overall the renewable industry in India has shown positive trends, replacing US as the second largest renewable market in terms of deployment. In the year 2018, India saw an y-o-y growth of about 75-111%,in rooftop installations, but a downward trend in tender executions. India added almost 7 GW capacity in 2018 compared to 24 GW of China. However, deep down, the growth in the Indian market has been sluggish compared to projections, owing to uncertainty around safeguard duty, certifications and taxation issues.
The safeguard duty did instill positive the sentiments among the local manufacturers who had been ravaged by the aggressive Chinese indulgence, but looking back the move did not yield results as desired, owing to retrieval of subsidies in the Chinese market thus increasing competition and pushing the prices down globally. Looking back,Indian manufacturers have struggled to bring down the costs to match the competition.
Apart from the safeguard duty, confusion surrounding the taxations of solar equipments has persisted and affected overall business. Apart from the key solar equipments which are charged 5% in taxes, mostly all ancillary components key to solar installations fall in the 12% & 18% tax slab. This is sometimes confusing, eating up a lot of time in litigations.
Way Forward in 2019
India is looking to add almost double the renewable energy installations over 2018. Majority of the projection is driven by large scale solar installation, followed by rooftop and off-grid systems. The industry had been expecting more government support along with policy fine tuning to aide the industry. However the budget proposal has seen little government initiatives to push the sector.
To positively push forward towards achieving the 2020 targets, India will have to focus more on the distributed solar installations like solar rooftop, solar pumping systems, floating solar plants allowing wider reach and faster execution. This may require special policy impetus from the government to allow widespread participation.