(Bloomberg) -- A Chinese energy conglomerate and SoftBank Group Corp. signed a $930 million agreement to produce and sell solar equipment in India, a country that is trying to bolster local manufacturing and curb reliance on clean energy imports.
Golden Concord Group Ltd. will invest in a 40 percent stake in the joint venture, with Japan’s SoftBank taking the rest, according to a March 31 statement from a unit of the Chinese company to the Shenzhen Stock Exchange. The project will have a capacity of 4 gigawatts and be involved in producing and selling solar ingots, silicon wafers, batteries and components, according to the statement.
The foray into India, the largest importer of solar equipment from China, comes after the South Asian nation proposed to boost domestic manufacturing with 110 billion rupees ($1.7 billion) in aid to reduce reliance on imports. While cheap cells and modules from China have benefited consumers and supported Prime Minister Narendra Modi’s ambitious clean-energy goals, the country has proposed imposing a 70 percent safeguard duty on cells and modules shipped from China and Malaysia, citing “threat of serious injury” to the domestic industry.
“Assuming that the government imposes safeguard duties as widely expected, we expect 2-3 large scale capacities to be set up over next few years,” Vinay Rustagi, managing director at the solar research firm Bridge to India said in an email. “Global manufacturers are attracted to the Indian market because of growing scale and the promise of duty protection.”
India’s maximum annual solar-cell manufacturing capacity is about 3 gigawatts while the average demand is 20 gigawatts. The nation’s renewable energy ministry has said that energy security demands for at least 60 to 70 percent of the manufacturing capacity should be located within the country.
©2018 Bloomberg L.P.
With assistance from Jing Yang