Following the disruption to regular supplies for the country’s solar energy sector as Covid pandemic hit production, the cost of inputs such as glass, backsheets, aluminium frames for modules among others has shot up causing supply chain issues.
As India pursues its target of 450 GW by 2030, the supply constraints, have highlighted the importance of domestic manufacturing under the Atmanirbhar Bharat Abhiyan.
Saibaba Vutukuri, Chief Executive Officer of Vikram Solar, says, “As a country we need to look at significantly expanding domestic manufacturing capabilities given the target set by the Government in terms of capacity additions.”
“To achieve 20 GW of solar energy capacity per year, India needs to import $10 billion worth of solar equipment, which needs to be substituted by $5 billion worth investment in domestic manufacturing. This will not only increase our capacity and create jobs in India but enable us to export. India will save approximately $50 billion worth imports,” he told BusinessLine.
Referring to the Production Linked Incentive (PLI) scheme, Saibaba said “The amount earmarked is small. India needs to introduce basic customs duty (BCD), otherwise the PLI scheme will not be helpful.”
“ There has been a substantial delay in introducing the BCD. And India is struggling with issues in SEZ on Equalisation Levy. The entire ecosystem of solar industry needs to be developed,” he said.
The solar glass price has gone up by 180 per cent, EVA sheet and back sheet cost has gone up by 80 per cent in last 3-4 months. About 90-95 per cent of glass, EVA sheet, back sheet and ingots are imported into India
“Eventhough India is one of the largest aluminium producers in the world we import aluminium frames. One of the world’s largest glass makers is in India, but we import glass from China, Indonesia or Malaysia. Therefore, India should consider the blueprint adopted by the automobile industry and apply it to the solar industry,” he said.
The country has 8-9 GW of total installed operational solar module and 2.5-3 GW of cell capacity. This has to be increased.