Import Of Solar Glass Will Attract 10% Customs Duty From Oct | NDTV Profit
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00:00There's another counter that's moving which is borosil renewables and if you can pull
00:06up the chart yeah it's up about nine percent at this juncture as well we saw a lot of gains
00:11yesterday as well yeah yeah and this is all because of what was announced during the budget
00:16now the government what they've decided is not to extend the exemption of basic custom
00:22duties on solar glass that was previously extended from March 2024 to September 2024
00:28now the import of solar glass will attract a 10 percent customs duty from October and
00:34the government also gave us more perspective on how the rooftop solar scheme for one crore
00:38households has you know translated through in terms of applications and to talk about
00:42all of this in the space in general we're joined by Pradeep Kumar Kheruka who's the
00:47chairman at borosil renewables good afternoon Mr. Kheruka
00:50yes so you know up first I would like to talk about the you know the move that has been
00:57in focus and that is the non-extension of the exemption of the custom duty custom duties
01:03on solar glass which is a key positive for the company itself could you give us more
01:07perspective on how this impacts the company and the industry as a whole
01:12well actually the exemption was announced originally in 1999 when India wanted to promote
01:18its solar manufacturing and no component used in the manufacture of solar module was made
01:25in India so at the time they had decided to make it inexpensive and thereby they had
01:30given an exemption to all the materials that went into the production of solar modules
01:37in about two years ago they had decided to withdraw the exemption on solar cells and
01:45customs duty was 25 percent was imposed on import of solar cells and 40 percent on built-up
01:50modules unfortunately at the time the other components were not considered and solar
01:58glass is a very capital intensive component which is used in the manufacture of solar
02:04module and it is a long gestation period between the time that you decide to set up the plant
02:10and the day you come into production so we have been representing this to the government
02:15for a long time and we are very happy that our voice has been heard and we are grateful
02:20to the finance minister for having agreed to withdraw the exemption from payment of
02:26customs duty on solar glass and copper strips and they have imposed a certain import duty
02:33on that which is going to go a long way in supporting the industry we are faced with
02:40an exporter which is China which has decided to dominate the entire industry worldwide
02:47they gave all kinds of support to the industry and these are the barriers by which we are
02:54able to have a level playing field so gratitude to the government for this right Mr. Kheruka
03:01also can you maybe dive into a little bit of numbers about how what will be the difference
03:06now in terms of what you're producing versus what's landing in from China like you mentioned
03:14see about last year's numbers were 700,000 tons of solar glass imported into India which
03:21is massive this is the output from several factories not one meanwhile what has been
03:27happening in our own country in India is that from just Borosil as a manufacturer of solar
03:33glass in 2023 alone we have seen the commissioning of four other factories so four other factories
03:43have come into India and from 180 tons per day in 2019 we are today at 2,300 tons per
03:50day that's a massive increase so Indian entrepreneurs are not lagging behind in meeting the demand
03:59of the nation towards making you know solar components and solar modules we have seen
04:06similarly a dramatic rise in the production of solar modules and my hats off to the government
04:16for having introduced the scheme of doubling the outlay for solar rooftops it's a massive
04:23thing it's massive because it's going to bring a free electricity directly into the hands
04:29of the consumer which would be a very big thing the second thing is going to be uninterrupted
04:34so during the day there's no question of a power outage because you're generating your
04:37own electricity you're self-sufficient and I think that's been a remarkable initiative
04:43by the government and so for all these reasons I see the demand going up significantly a
04:50big boost and hence we would be able to meet this demand so good step for the industry
04:58Mr. Kherag, I'm glad you touched upon the rooftop solar scheme you know I was just about
05:02to talk you know about how the solar industry as a whole has been growing in India as well
05:08as you know this initiative kind of bringing in more demand I want to know how is the domestic
05:13outlook looking at right now at current capacity and you know with the relief of the customs
05:17duty coming in would we see a demand pickup for the company in the second half of this
05:23financial year?
05:25See the situation is always a little more complex than what appears on the surface and
05:32solar glass is no exception what the government of China I think probably had a sense that
05:38this is going to happen so they reduced prices of solar glass before the before the budget
05:45was announced by 12 to 15 percent so they have tried to match the duty by reducing their
05:51prices and all of that is there but as I was saying to somebody a little while ago I've
05:58been in the glass business for 55 years now and I've weathered many storms I've seen lots
06:03of competition I've never surrendered before these things so when times get tough we sharpen
06:11our tools we narrow our vision and we put our shoulder to the task I'm very happy to
06:17say that my team in Borosil is equal to the job and we are cutting down costs and improving
06:25efficiencies so we are going to face this together and of course the government has
06:32announced its support which for us is a very very big thing we do have an anti-dumping
06:37duty application which has been filed and that's under investigation so let us see what
06:44the future holds for us but this act of the government has certainly instilled confidence
06:49in me.
06:50I also want to touch upon a little bit about the export market Mr. Kheruka I mean 20% of
06:55the revenues in FY24 came from the export markets how are the US and Europe markets
07:01you know looking like and also maybe give us some update on how your Germany manufacturing
07:06capacity is working.
07:08So fortunately the German capacity is working on full production there is a hiccup in Europe
07:17or there was a hiccup in Europe a little while ago because there were very severe price
07:23competition in Europe as well from Chinese module manufacturers so our European customers
07:29were module makers in Europe some of them shut shop but in the meantime the European
07:34Parliament has passed has sanctioned the grant of certain incentives to people to use European
07:43modules and the government of Italy and the government of Austria has already announced
07:49those incentives which has again caused a spurt in module manufacturing in Europe in
07:54Italy and in Austria and I think that France is going to follow suit and Germany cannot
08:01lag behind too far from this so with this initiative in Europe we see that there could
08:09be a there's likely to be an improvement in demand for the time being we are also shipping
08:15glass from our German factory into the United States and to other export markets so we are
08:22able to run fully and with further help coming our way we hope that it's going to improve
08:30further.
08:31Right Mr. Kheruka I just you know before I let you go one last question that is on the
08:35capacity expansion of plans 1100 tons per annum of capacity has been kept on hold for
08:40a while now will the company be going forward with this expansion this year or not?
08:46Well we have all the we have all the points in place to go for expansion but that's a
08:55decision we have to take at the board level which has not been taken so far and we were
09:00waiting for things to happen and now well this action has happened and this will prompt
09:06us to meet again reconsider our options we've going ahead with the rights issue which we're
09:12going to use the proceeds to reduce our debt and become you know a little better financially
09:18so I think things are in place and let's see what good comes out of this.
09:27Thank you so much Mr. Kheruka for joining us on the show today it was a pleasure having you.
09:33Thank you.