As India pushing for greater industrial self-sufficiency, Government plans to withdraw customs duty concessions in phased manner for wind-turbine components to encourage the use of local equipment
Wind installations levels in India have significantly declined in first half of year 2020 due to outbreak of Covid-19 crisis back in China. Consequently, the outbreak has effected the supply chains that further inflicted the wind energy segment in India. India installed only 136 MW of wind capacity in Q2 2020 which is well below the anticipated addition. Statistically, wind installation in Q2 2020 decline 82% compared to 743 MW in the same period last year, and a 28% fall from 187 MW in the previous quarter (Q1 2020). Moreover, The government is likely to withdraw customs duty concessions for wind-turbine components to encourage the use of local equipment and reduce imports from China and other countries as India is pushing towards greater industrial self-sufficiency. Although, 80-85% of wind-turbine manufacturing takes place in India unlike the solar energy sector, where about 90% of the modules come from China. However, some vital parts for setting up wind power projects are imported, mostly from China. Consequently, The import duty imposed on components varies widely and the removal of concessions will affect manufacturers to different degrees.
Revenues from existing wind projects have proven largely resilient to COVID-19 impacts; however, projects in the pipeline have experienced slowdowns due to supply chain disruption in SEA - South East Asia