With the alleged deaths of certain markets, the birth and growth of other markets was discussed with ardor. India is one market that stands out in the east, together with China. Apprehensions, doubts and challenges were laid out on the table, as experts talked about opportunities for investors and manufacturers in these markets.
Sanjay Chakrabarti spoke with charm and conviction about what he knows of the potential that lies in India. The speaker from Ernst and Young also highlighted the issues he foresees.
The solar community knows that India, like China, is a country to put on the watch list in terms of market growth for solar and with regards to the projects that the government is embarking on pushing the solar envelope to impressive limits. The time for India is now, stated Chakrabarti, India needs energy, irrespective of where is comes from. It is not a choice or option, so green energy is a must. Wind energy used to be the big thing. Solar has been non-existent. Non-existent for sometime, but once the government embarked on the Jawarhalal Nehru National Solar Mission, the industry has been on an upward solar spiral.
As of June 2010, the solar PV potential is 600,000 megawatts (MWs). The achievement thus far is 12 MW, he elaborates. Solar has taken off in an unexpected manner in India without a doubt. Chakrabarti continues: Solar is the center of the energy universe in India. With the 20 gigawatts (GW) aim by 2020, the implementation phase is kicking in now.
The utility projects in India have been taking off with ample support from the pro-solar government. When it all began, 150 MWs was expected as a total for applications under the solar mission. What came as the surprise in India was that the applications that came in totaled up to 1,700 MWs.
Of course, every country comes with its own issues and challenges. One cannot expect a solar manufacturer or investor to pack their bags and move into India. There are some key challenges that stand in the way. Doing business in India is a challenge. I am not going to lie. It is not easy getting land. Domestic content also needs to be taken into account. For PV modules, it starts with getting modules from India and, for thin film, there are no requirements. The project size is two to five MWs, but this is likely to go up, says Chakrabarti.
What happens when, as an investor, you would like to be working on a bigger project? There is of course a solution, according to the Indian PV expert.
He suggests that individual state governments can be approached on a project to project basis. The great thing about India is that the individual states are relatively strong and their policies and plans may not necessarily mirror the national government’s. It is easier to talk to these states and they can be relatively flexible in what they can offer, Chakrabarti explains. He gives Gujarat as an example: the state has a calculated solar capacity of 746 MW.
Chakrabarti also touched on the SIPS scheme or special incentive package scheme, which offers a capital subsidy of 20 percent for manufacturing plants. In terms of opportunities for foreign players, he sees Germany as a preferred partner that the Indians would like to work with. He suggests joint ventures, stating that local companies are just waiting for these joint ventures to happen to realize big projects.
Chakrabarti concluded with a witty statement, thus managing to put a smile on everyone’s face. I was a little apprehensive about the title of this session, Tomorrow’s markets. India is not a market for tomorrow. It is a market for today. And if you do not get in today, then tomorrow you will be too late.