India To Launch ‘Solar Zones’ Policy Soon

The Ministry of New and Renewable Energy (MNRE) in India is working on a policy aimed at promotion of solar power generation as well as solar power equipment manufacturing. The policy is expected to be released this month.

According to media reports, the MNRE is planning to launch a policy that would enable companies to set up solar power generation and equipment manufacturing facilities inside ‘solar zones.’ These zones are expected to be similar to the Special Economic Zones (SEZs) already operational in the country. These zones come with several incentives for the investors including tax holidays and infrastructure support.

While talking to media outlets, officials of the ministry stated that solar zones shall house solar power projects as well as equipment manufacturing units. Investors have receive support from the government in identification, acquisition or leasing of land. The government shall also provide for transmission and power evacuation infrastructure at the solar zones.

The policy seems to emphasise on the promotion of solar power equipment manufacturing. India aims to have an installed solar power capacity of 100 GW by March 2022. However, the country has only 5 GW of module manufacturing capacity and 2 GW of solar cell production capacity. Virtually no capacity exists for polysilicon production. Domestic manufacturing have unable to make any significant dent in the India solar power market which has been, for long, dominated by foreign modules manufacturers.

With this new policy, the government hopes to attract more investment in the manufacturing sector of the solar power market.

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