The US decision to impose high tariffs on imported solar cells, electric vehicles, batteries, and critical minerals from China will take effect on September 27, creating substantial export opportunities for Indian manufacturers, particularly in the solar equipment sector.
The US Department of Commerce has announced a 100% import duty on Chinese-made electric vehicles, 50% on solar cells, and 25% on EV batteries, critical minerals, aluminum, and steel. From 2025, polysilicon used in solar panel manufacturing will also incur a 50% duty. However, the USTR has granted tariff exceptions for solar and wafer-making machinery.
The US aims to protect domestic industries and combat Chinese dumping while investing $370 billion in clean energy under the Inflation Reduction Act (IRA). China produces 70% of EVs and holds over 90% of the global capacity for solar modules, wafers, and polysilicon.
After the US imposed restrictions, many Chinese companies shifted production to neighboring countries. In June 2022, the US imposed anti-dumping and anticircumvention duties on imports from Cambodia, Malaysia, Thailand, and Vietnam. However, the US Department of Commerce granted a 24-month duty-free access period for solar cells and modules from these countries until June 2024 to ensure supply and project stability.
India’s solar exports surged by 227% to $1.8 billion in 2023, up from $561 million in 2022, with the US representing over 97% of these exports. The remainder came from Indonesia and a few African countries.
By December 2023, India achieved a solar module manufacturing capacity of 64.5 GW and a cell capacity of 5.8 GW. By 2026, India’s module manufacturing capacity is projected to exceed 150 GW, while cell capacity is expected to surpass 75 GW.
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Resource: Fortune India
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