Niti Aayog’s proposed policy can help solar manufacturers to a great extent

A policy from Niti Aayog, which aims at helping manufacturing of solar equipments, will prove to be a major push for Indian solar manufacturers.

PM Modi has already backed the policy, which is expected to go to cabinet shortly.

"The new framework is almost ready... It is expected to be taken up by the cabinet soon," a senior government official told ET.

As per the policy, enabling conditions for solar generation capacity can be created, which would include off-take guarantees, 100% payment guarantees, an institutional hedging mechanism for foreign currency funds and a stringent offset.

For the capital subsidies to domestic manufacturers and upgrading the existing technology, money from the National Clean Energy Fund could be used.

A high-level, inter-ministerial panel set up by DIPP had recommended the major features of the policy.

As of now, the government is looking forward to a generation capacity of 100GW by 2022, out of which only about 6,000 MW has been set up. This is why the government is urgently unveiling a new scheme to establish 5,000 MW of solar photo voltaic manufacturing capacity by 2019.

The present solar manufacturing scenario in India consists of the assemble equipment largely importing from China, which makes them costlier than rival international products. The government is also keen to devise a policy to encourage overseas companies to set up manufacturing facilities in the country as a part of the Make in India initiative.

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