Blanket Safeguard Duty: If Implemented It Can Have Disastrous Effects on Indian Solar Industry

Director General of Trade Remedies (DGTR) initiated Safeguard Duty investigation on import of  Solar Cells, whether or not assembled in panels or modules in December 2017. The Director General of Trade Remedies in its preliminary findings recommended to impose 70% safeguard duty on imported solar cell and modules imported in India. Recently Committee of Secretaries decided to not impose Safeguard Duty based on preliminary findings and it decided to take call on duty once DGTR releases it’s final findings.  However, we should evaluate the scenario that will unfold if the duty is imposed.

 

Safeguard Duty: A Boon or Roadblock?

Indian solar industry is growing and the consistent progress portrays the Government initiatives in a bright light. However, the industry is still at a nascent age and requires constant support in development of a favourable environment for growth. And although, protecting domestic manufacturing industry seems to be the right move (Domestic players had a market share of 13 per cent in FY15, which is estimated to decline to 7 per cent in FY18), we have to understand that blanket Safeguard duty could lead to counterproductive results.

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