The Indian government has announced the suspension of the Approved List of Models and Manufacturers (ALMM) order for the financial year 2023-24.
The Ministry of New and Renewable Energy (MNRE) has issued a notification stating that solar projects commissioned by March 31, 2024, will be exempt from the requirement of procuring solar PV modules from ALMM. This relaxation in the mandate will be applicable for one year only.
The ALMM mandate was introduced in 2021 as a non-tariff barrier to boost domestic manufacturing. It approved the list of indigenous models and manufacturers who could participate in solar development projects bid out by the government. The mandate was later extended to the government’s open-access projects as well. Currently, 83 Indian manufacturers with a combined capacity of 21 GW have been approved under the list. Before the imposition of ALMM, Chinese manufacturers supplied 85% of India’s panel demand.
The intention behind the ALMM mandate was to reduce the import of solar equipment from China. However, it turned out to be a barrier in ongoing projects as the demand for solar modules far exceeded its indigenous supply. Only 10 GW of 500-watt peak panels could be made in the country, against 70 GW of solar capacity installation that were underway. To add to the woes, the government has also imposed a 40% basic customs duty on import of modules and 25% on import of cells.
This double-barrelled strategy to promote domestic production of solar equipment turned out to be detrimental for the industry, with manufacturers either stalling projects under construction or postponing those that were in the pipeline. Moreover, projects of at least 25 GW were held up for lack of grandfathering from the government because they were awarded before the ALMM was introduced but the commercial date was set after it.
In conclusion, the suspension of the ALMM mandate for the financial year 2023-24 will provide some relief to the solar industry. However, more needs to be done to promote domestic manufacturing and ensure the smooth implementation of ongoing projects.
View the official order here:
 order for the financial year 2023-24 to provide relief to the solar industry. Learn more about the mandate's introduction, its impact, and the government's latest decision to boost domestic manufacturing.){kind=link}