The government should reinstitute trade barriers, says India’s top solar module maker, to shield it from rivals like China and Vietnam.

Hitesh Doshi, chairman of Waaree Energies Ltd., stated in an interview that the temporary relaxation of a safeguard system declaring a list of authorised solar makers in March had brought in a flood of inexpensive imports and forced local manufacturers to idle some capacity.

The only answer, according to him, is the restoration of the so-called Approved List of Models and Manufacturers, a non-tariff barrier created to regulate which solar manufacturers are permitted to enter the Indian market. “We are pleading with the government to bring it back.”

Demands for the solar industry in India to diversify its supply networks followed delays during the pandemic. The government is currently attempting to strike a balance between the need to reduce inexpensive imports in order to stimulate domestic production and the need to ensure that local businesses can meet demand.

According to Doshi, import taxes are useless because important solar exporters like Vietnam have free trade agreements with India and Chinese suppliers have lowered their pricing to a point where their cargoes are competitive despite the 40% import tax that was previously in effect.

In spite of high taxes imposed on foreign-purchased cells and modules in 2022 and 240 billion rupees ($2.9 billion) in government funding allocated to support local industry, imports continued to rise after the government withdrew the authorised list. According to BloombergNEF, imports from April through August increased by roughly seven times compared to the same time last year.

India’s 12 gigawatts of module capacity is held by Mumbai-based Waaree, while 5.4 gigawatts of cell manufacturing infrastructure is under construction. Additionally, a 2 gigawatt module plant is being constructed in the US; it will start producing modules by April 2024.

According to Doshi, the company is debating a proposal for a public offering, the specifics of which ought to be set by the end of this month. Last week, The Economic Times reported that Waaree is looking to fund $350 million at a $3 billion valuation.

Previously, investment firm ValueQuest organised a funding round in which solar panel producer Waaree Energies Ltd. raised Rs 1,000 crore.

The most recent funds received will be applied to a 6 GW capacity expansion, which will increase the present 12 GW capacity, the business announced today.