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Budget: Accord priority sector lending status for solar energy sector, says Su-Kam Power System MD

Business Today's Anilesh S. Mahajan spoke to Kunwer Sachdev, Managing Director, Su-Kam Power Systems on his expectations from the Budget.

     Last Updated: July 7, 2014  | 21:47 IST
'Budget should accord priority sector lending status for solar energy sector'
Kunwer Sachdev, Managing Director, Su-Kam Power Systems.

Business Today's Anilesh S. Mahajan spoke to Kunwer Sachdev, Managing Director, Su-Kam Power Systems on his expectations from the Budget.

Solar as a source of power generation has huge potential in a country like India. However, after making significant strides in 2012, the solar market slowed down significantly in 2013. From a growth of 420 per cent in 2012, the industry slumped to seven per cent in 2013. It is an encouraging sign that the new government seems to be very clear about the significant role solar industry can play and is committed to realising its fullest potential. 

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1. Taxes

a) Solar power equipments (like solar invertors, UPS, charge controllers) should be brought under "zero" VAT/CST regime similar to solar panels all across the country.

b) Import of raw material used for manufacturing solar power equipments should be brought under "zero" duty regime.

2. Retail participation

a) Extend the 80 per cent accelerated benefit to individual taxpayer as well for installing rooftop solar systems and other solar energy equipments.

b) Retail lending facility through commercial banks for buying solar energy equipments, which should be as easy as getting a consumer loan.

c) Interest paid on loans used for solar energy systems should be allowed as deduction from income while arriving (at) income tax for individual taxpayer as well.

3. Priority sector lending status for solar energy sector.

4. Import of finished solar power equipments should have (an import) duty to help the domestic industry to grow.

5. The use of solar energy must be made mandatory for new construction through building bye-law.

6. RPO to be implemented strictly by imposing penalties on non implementation.

7. All forms of tax, including CST, VAT and service tax, should be waived off on the grid connected and off grid solar energy projects using indigenously manufactured system for a period of five years. This will help in cost reduction and growth of the entire value chain of the domestic industry.

8. Anti dumping duty: There is a huge gap in domestic manufacturing capacity versus the demand. The anti-dumping duty on solar panels should be postponed.

Kunwer Sachdev is Managing Director, Su-Kam Power Systems.

As told to Anilesh S. Mahajan


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