Amid its own nationwide lockdown, India has launched a major push to lure wind and solar manufacturers from China, claiming “many companies” are looking to move operations away from the latter in the wake of the coronavirus pandemic.
The Ministry of New and Renewable Energy (MNRE) said it was taking action “in a big way” to encourage new renewable energy hubs in various states and ports across India, able to serve its own domestic market and export abroad.
MNRE secretary Anand Kumar held meetings with manufacturers over potential investments last week, with trade commissioners targeting the US and other nations to encourage inwards investment, said a statement from the ministry.
“In a time when many companies are planning to shift their manufacturing base from China, it is opportune time for India to bring policy changes for facilitating and catalysing manufacturing,” the statement said. Initiatives include reduced borrowing costs and project-specific funding linked to local manufacturing.
With its 10GW wind manufacturing base, India was identified as a potential backup for the supply chain early in the global Covid-19 pandemic, when Chinese production was a standstill and with it one of the world’s key production hubs. Siemens Gamesa said in mid-February “ it had started to develop India as a global hub to reduce our dependency from China”.
While fairly self-sufficient in wind, India is heavily reliant on China for solar supplies, importing about 85% of the cells and modules used.
MNRE cited a wish-list of suppliers including “silicon ingots & wafers, solar cells & modules, wind equipment and ancillary items like back sheet, glass, steel frames, inverters, batteries etc”.
However, since February the focus of coronavirus-related supply chain issues has shifted decisively beyond China, where renewables-related manufacturing activity is returning to normal.
India by contrast is like other markets in the midst of a government lockdown that has brought production to a virtual halt, with global giants including Siemens Gamesa, Vestas and LM Wind Power having to idle factories.
Analysts at Wood Mackenzie said earlier in April that one-fifth of India’s wind and solar installations could be delayed this year because of the lockdown.
The country has also suffered high-profile challenges in its development sector as it chases ambitious renewable energy installation goals, with issues including land availability, undersubscribed auctions and financially-fragile state offtakers.