India will impose anti-dumping duties on solar panels imported from the United States, China, Taiwan and Malaysia to protect domestic solar manufacturers, according to a government statement seen by Reuters on Friday.
The order, almost certain to anger India’s trading partners, sets duties of between 11 and 81 US cents per watt and comes after a investigation which started in 2011. The ruling by a quasi-judicial body has to be published by the Finance Ministry before it takes effect.
The decision adds to India’s growing trade disputes just before Narendra Modi takes office as prime minister on Monday.
“Imposition of anti-dumping measures would remove the unfair advantages gained by dumping practices,” said India’s Anti-Dumping Authority in its order released on Thursday.
Local manufacturers have long complained that US, Chinese and Malaysian companies enjoy state subsidies and are selling their products at artificially low prices to capture the Indian market.
India also believes that anti-dumping duties imposed on Chinese solar producers by the European Union and the United States have further driven down the price of Chinese solar products, to the detriment of Indian suppliers.
India aims to raise its solar power capacity to 20,000 MW by 2022 from 1700 MW currently. It imported solar products worth nearly 60 billion rupees ($US1.03 billion) last year, according to an industry estimate. Domestic manufacturers got less than 2 per cent of that business.
“India’s solar manufacturing is now bound to revive and further increase with both local and overseas participation ensuring a robust supply chain,” said H.R. Gupta of the Indian Solar Manufacturers’ Association.
Under the new duties, importers will have to bear additional costs of between 5 per cent and 110 per cent while importing solar cells and panels from the United States, Malaysia and China.
The US Trade Representative has filed two cases against India at the World Trade Organisation (WTO), complaining local content rules discriminate against US solar companies.
A senior USTR official said the United States would look carefully at the new duties given the importance of the US solar industry.