Govt hikes duty on solar invertors, lamps

New Delhi: The government on Monday proposed to raise import duty on solar inverters and lanterns or lamps but did not go ahead with its plan to impose basic custom duty on solar equipment across the board to boost domestic manufacturing.

The Solar Power Developers Association had urged the government to hold back its plan to impose basic custom duty (BCD) on solar equipment for time being in view of India's ambitious target of having 175GW of renewable by 2022, which include 100GW of solar power. Solar developers depend heavily on solar equipment imports due to limited production capacity of the domestic industry.

In her Budget speech in the Lok Sabha, Finance Minister Nirmala Sitharaman said, "We have already acknowledged that solar energy has huge promise for India. To build up domestic capacity, we will notify a phased manufacturing plan for solar cells and solar panels." "At present, to encourage domestic production, we are raising duty on solar invertors from 5 per cent to 20 per cent, and on solar lanterns from 5 per cent to 15 per cent.