EQ sought views of Mr. Hitesh Doshi – Chairman of Waaree Energies Ltd. on his expectations from the upcoming Union Budget.
Given the rising demand and the fluctuating supply of coal and petroleum products, the Government of India has underlined the vital role it expects the solar industry to play in the country’s continued growth. Boosted by this vote of confidence, the industry expects a clear business opportunity of at least $70 billion in the next five years through sale of solar equipment. Keeping this in mind, there are certain expectations from the upcoming budget that can help the Indian solar industry realize this huge potential.
On the manufacturing front, there must be a push for producing a major portion of the industry’s material requirements within the country. Currently, a major chunk of the Indian solar industry’s requirements is being fulfilled by China owing to the difference in pricing, manufacturing capabilities and insurances. The Government must make similar incentives available to the indigenous manufacturers or implement anti-dumping policies along the lines of USA and Europe. If these measures are put into effect, we envisage a target of at least 60% material production taking place within India, which amounts close to $42 million. This ties in well with the Prime Minister’s ambitious ‘Make in India’ project and will serve to drive the national economy and GDP. Moreover, by decreasing the dependence on imported goods, it will serve to improve the country’s balance of trade quotient. Insurance companies need to step up to the plate and deliver viable schemes for insuring solar panels, while there must also be a dedicated effort made to position India as the global R&D hub for solar power. To achieve this, at least 3 percent of the potential investment made into the solar industry will need to be funnelled through for R&D and technology. These measures will revitalize the manufacturing sector, and will encourage it to meet the equipment demands made by the developers.
The development segment, on the other hand, is also in need of an urgent revamp. This can be achieved by policy reforms that are aimed at reinvigorating the sector. One such policy reform that comes to mind is that of depreciation benefits. Currently, most of the projects and tenders relating to the solar industry see no differentiation between the developers who avail the depreciation benefit and those that do not. Making depreciation tradable can address this gap and will lead to more players playing an active role in the solar development sector. This measure will directly result in better competition and improved service delivery.