In the morning of July 17, Reuters reported that the Indian Ministry of Trade proposed in a report to the government on July 16 that it would impose a 25% tariff on solar cells and modules imported from China and Malaysia for a period of one year. To resist what it believes poses a threat to India's domestic solar equipment industry.
At the same time, the reporter found that some media released information about the final decision of the Indian PV security measures, and attached a screenshot of the document.
The document shows that the Indian PV safeguards case was finalized. The General Administration of Trade and Relief recommended a two-year safeguards tax on imported battery chips and components in the first year of 25%, the first half of the year, 20%, and the second half of the 15% tax rate. Since developing countries outside China and Malaysia alone will not export more than 3% of India's total imports, and the total exports to India will not exceed 9% of India's total imports, the safeguards tax can be waived.
However, as of press time, the reporter has not yet found relevant documents on the official website of the Indian Ministry of Security Measures (DGS), the main body of the investigation of the PV security measures in India. Regarding the ongoing investigation, the document only shows the preliminary findings of January this year. The new proposed tariff is much lower than the 70% recommended by DGS in January this year.
Repeated face
The above documents show that the safeguards will be implemented after the Standing Board agrees and the Ministry of Finance issues a taxation order. That is to say, this measure has not been finalized.
The safeguards investigation began at the end of 2017. Subsequently, China Electromechanical Chamber of Commerce immediately convened the Coordination Coordination Meeting to organize 56 companies to conduct a harmless defense. But in June 2017, the Indian Finance Minister Hasmukh Adhia was on a dedicated GST Twitter. The account said that solar modules will be subject to a 5% Goods and Services Tax (GST), and the new tax rate will be implemented from July 1, 2017.
On January 5 this year, the General Directorate of Safeguards of India (DGS) announced the preliminary findings of the safeguards, suggesting that the Indian government will enter the Indian PV products (whether packaged into components or not, before the final result is finalized). Said to include crystalline silicon cells and components, thin-film batteries and components) to impose a 70% defensive tariff as a temporary safeguard for a period of 200 days.
Two months later, the Indian side once again 'changed face'. On March 23, the Indian Ministry of Commerce and Industry issued an announcement to terminate the anti-dumping investigation on photovoltaic products in China, Taiwan, and Malaysia.
This caused dissatisfaction with the Indian Solar Manufacturers Association (ISMA), who wrote to the Ministry of Commerce in favor of DGS's proposed tariff of 70% on imported solar PV cells and components.
However, this proposal did not receive a response. According to the Indian Economic Times in early June, the Indian government has decided not to impose a temporary guarantee tax on solar cells imported from China and Malaysia, and rejected the previous proposal to impose a 70% tariff. Minister Anand Kumar confirmed to the media that protection tariffs will not be implemented at the moment. According to the Indian Economic Times in June, the Standing Committee on Safeguards under the Ministry of Finance of India has just decided not to impose such tariffs.
However, the industry is puzzled that the Indian Trade Relief and General Administration (DGTR) under the Indian Ministry of Commerce held a public hearing on June 26 to discuss a 70% guarantee tariff on imported solar equipment. The battery and module implement a 95% guarantee tax to protect domestic manufacturing companies from cheap imported goods.
The positions of different interest groups in India are obviously very different. In fact, India has long been entangled in tariffs on the photovoltaic industry.
As early as September 15th, 2012, after Europe and the United States put forward a 'double-reverse' investigation on China's PV industry, India also proposed a double-reverse investigation application.
In 2014, the Indian Ministry of Finance decided not to implement the anti-dumping final taxation ruling of the Indian Ministry of Commerce and Industry on imported PV products from China, Taiwan, the United States, and Malaysia. The case ended with no taxation after 21 months. However, the Indian side has subsequently announced that it will double the import of photovoltaic products.
In recent years, India has become the third largest PV market in China except the United States. In 2017, India's new PV installed capacity is about 9GW. In FY 2018, the PV construction plan will be as high as 11GW. The Indian government plans to achieve 100GW in 2022. Photovoltaic installation targets. However, the Indian PV market is highly dependent on imported PV modules, with nearly 85% of PV products coming from imports.
Hung Hom, director of the Photovoltaic Research Center of the China Energy Economic Research Institute, told reporters that the Indian market is the most competitive and attractive market in recent years. India has always wanted to build its own production capacity, but it has not been particularly large so far. However, many Chinese PV companies are now going to India to build factories.
Limited impact
While China is India's largest source of components, India is also China's largest overseas export market. In 2017, the total domestic exports of India's components was 9.46GW, accounting for 24.96% of total exports.
Although the Indian side is uncertain, it will still have some impact on Chinese PV companies. However, more companies have prepared in the past, and it is a common choice to build factories overseas. GCL integration, Trina Solar, Crystal Australia and other companies have cooperated with related companies in India to build production bases.
Gao Jifan, chairman of Trina Solar, said in May that India has become the core target market of Trina Solar. India's new energy industry consulting company Bridge to India recently released the "National Solar Industry Map Report" shows that the world's leading Trina Solar, a total solar energy solution provider, is far ahead of its competitors with a market share of 25.7%, becoming the largest component supplier in the Indian market in 2016.
In the past, Longji Leye supplied more than 100 megawatt-scale photovoltaic power plant monocrystalline modules to India. According to customs export data, in January-May 2018, Longji Leye components shipped the first in India.
In response to the possible impact of taxation in India, Long Qian Le Ye domestic marketing manager He Qiang told reporters that in fact, the impact on Longji is not great.
'Because the local factory is set up, the amount of actual exports is very small, so the impact of tariffs is not big. The Indian market accounts for a small layout of the overseas market of Longji. 'He Qian said.
Hung Hom said, 'Although domestic and foreign policy factors will make enterprises more stressful, but it may not be a bad thing. The market environment has increased the pressure, but it is actually a good thing for a competitive enterprise or a company that has been prepared for a while. Going overseas, companies that are expanding to India are not good at all. The reason why China's PV industry needs to be integrated is because we are oversupply and there are too many uncompetitive companies.
Therefore, India's tariff increase has not caused too much repercussions for domestic companies. Compared with the previous US and European double-reverses in 2012, it is not at all an order of magnitude.
'In 2011, our PV products accounted for 95% of total production, but after 'double reverse', the proportion of exports shrank to 30%-40%. But I think the most ideal state is the overall export level. Should be at 50%, the current ratio is unreasonable, not conducive to coping with risks. ' Red 炜 said.
It is worth mentioning that with the approach of September 2018, the EU's policy toward China's double-reverse is about to expire, and the European Commission will decide whether to revoke or extend these measures.
