Trump Solar Tariffs Reverberate in India, China's Biggest Buyer
(Bloomberg) -- President Donald Trump imposing duties on foreign-made solar equipment comes as India considers its own protections from overseas supplies after becoming China’s biggest solar panel export market last year.
India’s finance ministry this month pitched a 70 percent safeguard duty on cells and modules shipped from China and Malaysia, citing “threat of serious injury” to the domestic industry. As the proposal winds its way through India’s bureaucracy, U.S. President Donald Trump on Monday slapped duties of as much as 30 percent on solar equipment made abroad.
The move “may nudge the Indian government in the decision for tariffs,” said Vinay Rustagi, managing director at solar research firm Bridge to India.
“A few weeks down the line when Indian policymakers decide on this, they will have the comfort in the back of their minds that a developed country, with which they have aligned more, having done it,” he added.
China delivered 9.28 gigawatts of panels to India last year, up 75.6 percent from a year earlier, according to data provided Tuesday by the China Chamber of Commerce for Import and Export of Machinery and Electronic Products. The South Asian nation bought about 31 percent of Chinese solar panel exports. Japan slipped to second, with 5.17 gigawatts, followed by Australia and the U.S.
India could gain from the U.S. duties by deciding not to impose its own tariffs and take advantage of possible lower prices as suppliers seek new markets, according to energy researcher and consultant Wood Mackenzie Ltd.
“The Indian government should review their duty proposal to leverage the opportunity of procuring cheap solar panel production,” Frank Yu, the Asia-Pacific power and renewables principal consultant at Wood Mackenzie said by phone from Beijing.
China exported 30 gigawatts of panels last year, 28.5 percent higher than a year earlier, according to the commerce chamber. Average panel prices tumbled 23 percent, leading the overall value of the exports to drop 1.2 percent to $10.6 billion.
Chinese producers have benefited from growing demand to harness energy from the sun as costs of the clean technology become cheaper. More than 70 percent of the world’s panels are made in China, according to Bloomberg New Energy Finance.
©2018 Bloomberg L.P.