Almost shut out of India’s expanding solar-panel market, the US won a ruling against domestic-production requirements, but Indian companies are overwhelmingly choosing Chinese products over US and Indian.US solar-panel exports to India—which doubled its solar capacity over 22 months ending January 2016—fell 83% since 2011, while Chinese exports grew 90% over the same period, according to an IndiaSpend analysis of Indian commerce ministry data.
Plunging US exports led that country to successfully dispute a “make in India” requirement for solar panels and modules used in the country’s national solar-power programme. That requirement was inconsistent with international trade norms, the World Trade Organization (WTO) ruled late in February.
Domestic-content requirements (DCR) were imposed in 2011 for government solar-power projects.
China’s solar-panel exports grew from $577 million in 2011-12 to $1,094 million in 2015-16 (April-December). China is the largest exporter of solar panels (solar cells/photovoltaic cells, whether assembled or in module/panel form) to India, accounting for 65% or $3.2 billion of $5 billion in solar-panel imports by India over the past five years.
India’s import of solar panels from across the world increased 60%, from $821 million in 2014-15 to $1.3 billion in 2015-16 (April-December), despite the DCR, and it has been reported that India will contest the ruling.The US ranks fifth in terms of India’s imports of solar panels, based on data for 2015-16 (April-December). Over the last five years, India has imported solar panels worth $298 million from the US. India’s imports of solar panels from the US declined 83%, from $120 million in 2011-12 to $21 million in 2015-16 (April-December).
Chinese panels are cheaper by Rs 5 to Rs 6 each than those produced domestically. In addition, there are quality issues with locally made panels and cells, according to this Economic Times report. While a consignment from China takes 30-45 days to be delivered, there are few customers for domestically produced solar panels.