In November last year, the US Department of Commerce published its initiation of the countervailing duty (CVD) investigation of utility scale wind towers from India. In February 2021, nine additional new subsidy allegations (NSAs) were filed and the Department of Commerce recommended initiating investigations on eight programs under question.
Among the Indian government programmes under investigation are the Priority Sector Lending Program, Concessional Custom Duty Exemption Certificate and the Enhancement of Competitiveness in the Capital Goods Sector: Technology Acquisition Fund Program. The Incentives to Industries Scheme under the Gujarat Industrial Policy are also subject to investigation.
According to the US International Trade Administration, “The merchandise covered by this investigation consists of certain wind towers, whether or not tapered, and sections thereof. Certain wind towers support the nacelle and rotor blades in a wind turbine with a minimum rated electrical power generation capacity in excess of 100 kilowatts and with a minimum height of 50 meters measured from the base of the tower to the bottom of the nacelle (i.e., where the top of the tower and nacelle are joined) when fully assembled.”
Vestas Wind Technology India is the only individually examined exporter/producer in this investigation. The Department of Commerce has preliminarily determined a subsidy of 3.74 per cent. It has estimated a rate of 397.16 per cent against Naiks Brass & Iron Works, Nordex India, Prommada Hindustan, Suzlon Energy, Vinayaka Energy Tek, Wish Energy Solutions and Zeeco India based on the adverse facts available.
This aggressive posturing by the US government
is similar to the stand taken during the previous stint of Democrats in the United States. India had faced criticism at the World Trade Organisation (WTO) for its domestic content requirement clause in government tenders. The US had then alleged that Indian tenders were discriminating against American businesses that wanted to participate in India’s solar energy deployment programs. India had lost this case at the WTO in 2016.
Subsequently, India filed a complaint against local content requirement mandates in eight American states and won at the WTO in 2019.
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.