26 March 2016 07:09:14 IST

Solar row: India examining protection given by US States

Piyush Goyal, Minister of State for Power, Coal and New and Renewable Energy, says India is ingenious enough to find alternative ways to protect the domestic solar industry

Centre looking at the option of filing a case in the WTO

The Centre is considering filing a case against the US in the World Trade Organisation (WTO) related to American State government programmes that protect domestic manufacturers.

This was stated by Piyush Goyal, Minister of State (Independent Charge) for Power, Coal and New and Renewable Energy, at a Confederation of Indian Industry event here on Friday.

Commenting on the WTO’s ruling on mandatory domestic content stipulations in India’s solar power generation programme, Goyal said: “There are at least nine US States which have similar programmes that give protection to domestic manufacturers. I am now examining them and after that we will file a case against the US.”

“We will, of course, go and appeal against the WTO order. But we are ingenious enough in India to find an alternate mechanism to protect our manufacturers,” he added.

While the Jawaharlal Nehru National Solar Mission aims to add 100,000 MW by 2022, the local content requirement is only for 8,000 MW for rooftop and land-based projects where the government provides a subsidy.

India has been arguing that since the power generated through JNNSM was bought by NTPC, a public sector agency, the transaction qualifies as government procurement and is not covered by WTO rules.

This was rejected by the WTO, which stated that the domestic content requirement was on power equipment and not on power that is bought by the government.

Tarun Kapoor, Joint Secretary of the Ministry of New & Renewable Energy, said earlier in the week that domestic manufacturers will be given protection by procurement through defence agencies and other such means.

“It is very unfortunate that the US decided to pursue their case against India in the WTO. All that India has done is to protect domestic manufacturers who have so far given 400 MW of equipment to the installed capacity of 6,000 MW,” he said.

Goyal said: “When India scales up to a 100 GW, all that the Indian manufacturers can produce is about 15-17,000 MW over the next seven years. This would still leave more than 80,000 MW of market for the world. The US took a very myopic view.”

The Minister also warned that if Indian manufacturers manage to prove a case of dumping against the US manufacturers, solar power will become expensive forcing the government to abort the solar programme.

Dumping worries “Our domestic manufacturers had won a complaint against US manufacturers for dumping their products in India which would have resulted in high anti-dumping duties. I personally persuaded the Indian manufacturers, and it was their magnanimity, who withdrew their request. If Indian manufacturers go back to seeking anti-dumping duties, solar power will again become expensive and we may have to abort the programme,” said Goyal.