India Extends Tariff Exemptions for Imported Goods to Support Domestic Industries and Renewable Energy

The Central Board of Indirect Taxes and Customs (CBIC) in India has recently issued an amendment extending the tariff exemption period for certain imported goods until September 30, 2024. This decision is authorized under Section 25(1) of the Customs Act, 1962, and is aimed at sup-porting the growth of domestic industries, particularly in the areas of renewable energy and offshore oil exploration.

The amendment covers a range of products and tariff items, providing them with extended exemptions until September 30, 2024. Key items included in the amendment are:
1. EVA (Ethylene Vinyl Acetate) Sheets: - Chapter 3208, 3815, 3901, or 3920 - Materials such as EVA resin, masterbatch, PET film, PVF, PVDF, adhesive resin, and adhesive hardener for manufacturing solar photovoltaic cells or modules.
2. Solar Tempered Glass: - Chapter 70 - Exemption extended for solar tempered glass or solar tempered (anti-reflective coated) glass used in the production of solar cells/panels/modules.
3. Cold Rolled Grain Oriented Steel (CRGO): - Chapter 7204, 7225 19 90, 7225 - Magnesium Oxide (MgO) coated cold rolled steel coils and various types of steel coils for manufacturing CRGO steel.
4. Offshore Oil Exploration: - Chapter 84 or any other Chapter - Parts and raw materials for the manufacture of goods related to offshore oil exploration or exploitation.
5. Lithium-Ion Cells: - Chapter 8507 60 00 - Exemption extended for lithium-ion cells used in the manufacture of batteries or battery packs for cellular mobile phones and electrically operated vehicles or hybrid motor vehicles.

One of the key aspects of the amendment is the extended exemption for EVA (Ethylene Vinyl Acetate) sheets, which are used in the production of solar photovoltaic cells or modules. This includes materials such as EVA resin, masterbatch, PET film, PVF, PVDF, adhesive resin, and adhesive hardener.
PET film, a critical raw material in the manufacturing of solar backsheet films, has also been included in the exemption range.

The use of PET resin in solar backsheet materials is predicated on its exceptional physical and chemical stability, as well as its superior barrier properties. PET resins exhibit high strength and toughness, providing robust protection for solar panels against physical damage from external elements. Their outstanding barrier properties effectively prevent the entry of moisture, oxygen, and other gases, thus reducing corrosion and damage within the panels. Additionally, PET resins offer good UV blocking, shielding the internal electronic components of solar panels from the effects of UV radiation. Currently, PET resins plays a crucial role in the solar industry, including companies like Wankai New Materials Co., Ltd. in China that produce PET resins (WK-681 and WK-711) for solar backsheet films.

The extension of the tariff exemption period for related PET materials is expected to help reduce the production costs of solar backsheet films, thereby promoting the development of the solar industry and supporting the Indian government's commitment to the renewable energy sector.

With the global emphasis on renewable energy and the rapid growth of the solar industry, countries, including India, have implemented policies to support the development of clean energy. Consequently, the demand for materials such as PET chips is expected to continue rising.