Taipei, Taiwanese solar cell and solar module manufacturers have been covered by a safeguard recommendation proposed by India, which says that imports have caused or have threatened serious damage to its industry, according to the Bureau of Foreign Trade (BOFT) under Taiwan's Ministry of Economic Affairs (MOEA).
The BOFT said India's Directorate General of Trade Remedies (DGTR) released a final ruling Monday after an investigation, recommending an up to 25 percent safeguard duty against imported solar cells and modules for two years.
The BOFT said the safeguard duty is aimed at all solar cell and module imports, except goods from developing countries, but as Taiwan is not one of the developing countries by Indian standards, Taiwanese firms will be still affected by the financial burden.
International business wire services reported that the safeguard measures largely target China and Malaysia, the two largest foreign solar cell and module suppliers to India.
According to the DGTR proposal, the safeguard duty will hit 25 percent in the first year of implementation, and will be lowered to 20 percent in the first half of the second year and to 15 percent in the second half of the second year.
The BOFT said the DGTR will send the recommendation to India's Ministry of Finance for approval.
"Imposition of safeguard duty in this case is in the public interest because it will prevent complete erosion of the manufacturing base of solar industry in the country," the DGTR recommendation indicated.
The Indian Solar Manufacturers Association (ISMA) filed a petition with the Indian authorities in December 2017 to kick off an investigation under the World Trade Organization's safeguard mechanism to protect Indian manufacturers from the impact of imports.
In January, the DGTR came up with a preliminary ruling to recommend an up to 70 percent safeguard duty, but the Supreme Court of India questioned the legitimacy of the recommendation and asked for an end to the probe.
However, the DGTR continued its investigation and held hearings in June, in which officials from Taiwan's representative office to India and representatives of the Taiwan Photovoltaic Industry Association made a presence and represented opinions about the safeguard measures.
The BOFT said Taiwan accounts for less than 3 percent of India's total solar cells and module imports, since Taiwan-made products are generally in the high-end category, but Taiwanese firms will continue to watch how the safeguard measures will have an impact on their sales.
In addition, the BOFT said that since India depends heavily on imported solar cells due to low domestic supply, the Indian solar energy industry has been divided over the safeguard measures, which could have uncertainty over the safeguard duty.
The BOFT cited data compiled by the Global Trade Atlas as saying Taiwan sold US$92.07 million-worth of solar cells and modules to India, making up only 2.23 percent of the South Asian country's total imports in 2017.
While Taiwan ranked as the third-largest supplier to India in 2017, its sales share lagged far behind China's US$3.63 billion, or 88.20 percent of the total, and Malaysia's US$242.85 million, or 5.89 percent, the data shows.
Source: Focus Taiwan News Channel