Deadline Extended for the Review Investigation of Continued Solar Safeguard Duty

The Directorate General of Trade Remedies (DGTR) has announced an extension for filing responses to the questionnaire regarding the review investigation for the continued imposition of safeguard duty on solar imports.

The date for the submission of responses has been extended from April 30, 2020, to May 11, 2020. The extension has been announced in view of the ongoing lockdown to arrest the development of the coronavirus pandemic. No further extension will be granted.

Before this, the DGTR, under the aegis of the Ministry of Commerce and Industry, had extended the deadline from April 10, 2020, to April 30, 2020.

The period of investigation for the present investigation is from April 1, 2016, to September 30, 2019.


Background

In March 2020, Mercom had reported that the Directorate General of Trade Remedies was initiating a review investigation for examining the need for the continued imposition of safeguard duty on the import of solar cells. An application was filed by the Indian Solar Manufacturers Association (ISMA) seeking continued imposition of safeguard duty for another four years. The domestic manufacturers filing the petition had provided import data released by the Department of Commerce from 2014-15 to 2019-20 (up to September 2019) for this investigation.

In December 2017, the original investigation was initiated on the application filed by five domestic manufacturers through ISMA including Mundra Solar PV Limited, Indosolar Limited, Jupiter Solar Power Limited, Websol Energy Systems Limited, and Helios Photovoltaic Limited, seeking the imposition of safeguard duty against the imports of solar cells and modules from China, Malaysia, Singapore, and Taiwan. These five companies claimed that they collectively manufacture more than 50% of solar cells produced in India.

The DGTR issued final findings in July 2018 based on which safeguard duty was imposed for two years.  The duty was set at 25% for the first year, followed by a phased down approach for the second year, with the rate reduced by 5% every six months until the duty is set to end after July 2020.

Later, Mercom’s research found that solar developers had been struggling to get reimbursement for their additional expenses since the implementation of the duty. This adversely affected their business and the pace of project development in the country.

The domestic solar module manufacturers also expressed their discontent months after the safeguard duty imposition. They stated that the policy had failed to achieve the desired objectives of protecting domestic manufacturers from a sudden surge of imports since the safeguard duty was imposed for only two years, and the implementation period of utility-scale solar projects is 18 to 24 months.

Due to the lockdown, the central government has announced several relaxations to its existing policies to support various industries, including the solar sector. Track all the latest news developments on Mercom’s coronavirus live updates here.