Arpit | 30th July 2018

In a move that was feared and long seen coming, India has decided to levy a 25% safeguard duty on solar panels imported from China and Malaysia. The duty will be levied on all panels imported between 30th July 2018 to 29th July 2019. For further one year, the duty will be reduced to 20% and then 15% between six months intervals.

The import duty prima-face has been placed in order to encourage the local solar panel manufacturers in the country in a push to the Make in India effort. However, with the majority of top solar projects using these imported panels especially from China, this will at least in the short term create choppy waters. Add in the confusion surrounding GST, the solar industry has a fight on its hands.

The notification for the duty was released by the Ministry of Finance on July 30th, 2018 and it would be very interesting to see how will the industry react and whether the pricing will get even more volatile. The safeguard duty order is available both in English and Hindi and can be read in detail here.

Editor update: Aug 14: The duty has been deferred for now