Power minister RK Singh said the ministry has received expressions of intent to set up 20 GW more domestic solar module and cell manufacturing capacity in the country. And the minister said the interest in establishing new fabs was independent of plans to subsidize borrowing rates on capital loans through an ‘interest subvention’ scheme planned by the Ministry of New & Renewable Energy (MNRE).
Singh was speaking at the India PV Edge 2020 online event this week, organized by government thinktank NITI Aayog, the MNRE and Invest India.
The intervention planned by the MNRE to offset high borrowing costs would reduce interest rates for capital expenditure related to solar cell and wafer production as well as for working capital, technical upgrades three years into factory life and energy costs. That program would run alongside customs duties which are applied to solar imports.
“Manufacturers using advanced or futuristic technology will be provided additional incentives,” said the minister on Tuesday. “We will build that into [the] interest subvention scheme.”
The NITI Aayog has also proposed a production-linked incentive scheme for Indian solar module exports which, according to MNRE joint secretary Amitesh Kumar Sinha, would reward high-efficiency and low-thermal-loss products as well as incentivizing local production.
With India 64 GW short of the 100 GW of solar generation capacity it wants by 2022, there is huge demand for polysilicon, wafers, cells and modules, at least some of which could be met by local manufacturing.
The nation has around 16 GW of annual solar module manufacturing capacity, of which around 9.5-10 GW is currently operational. India has just 2.5 GW of annual solar cell production capacity.
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