The Commerce Ministry has actively encouraged the collaboration between the Chinese firm M/s Sinotec Solar (Pvt) Limited and M/s Ghani Glass for the local production of solar panel components. This initiative was a focal point in a recent meeting chaired by Additional Secretary Incharge of the Ministry of Industries and Production, Rashid Mahmood Langrial, as reported by Business Recorder.
During the meeting, the discussion extended to Sinotec’s import plans, with Langrial advocating for the resolution of tariff and tax disparities that adversely impact the local solar industry. He cautioned against imposing high duties on imported solar panels, emphasizing that the government’s flexibility in waiving duties and taxes for Sinotec would be contingent on their commitment to a long-term localization plan tailored for Pakistan.
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A representative from Sinotec presented a conditional localization plan, outlining six solar panel components. However, concerns were raised regarding the feasibility of Sinotec’s conditions, particularly in terms of local market volume, prompting skepticism from the Ministry of Industries.
In response, the Ministry of Commerce proposed a collaborative effort between Sinotec and Ghani Glass to facilitate localization endeavors. The objective is to promote technology transfer and genuine value addition through local manufacturing. After thorough deliberation, the meeting concluded with several key decisions:
- Responsibilities and Timelines: The Engineering Development Board (EDB) will delineate the responsibilities of government departments, categorizing tasks with specific timelines.
- Tariff and Tax Projections: The Ministry of Commerce will prepare a comprehensive summary outlining tariff and tax projections for the next decade.
- Unconditional Localization Plan: Sinotec is required to provide an unconditional localization plan spanning five to seven years. This plan should be supported by a bank guarantee and developed in consultation with Ghani Glass. The EDB will evaluate the viability and feasibility of this proposed plan.
This collaborative effort underscores the government’s commitment to fostering local production of solar panel components, aligning with broader objectives of technology transfer and value addition within Pakistan. The decisions made in this meeting aim to create a framework that encourages sustainable growth in the domestic solar industry while addressing challenges related to tariffs, taxes, and localization. As the parties involved work towards a consensus, the outcome of this initiative holds the potential to significantly impact the trajectory of the solar industry in Pakistan.
