MoC advises Sinotech Solar to start local manufacturing in Pakistan

The Commerce Ministry has advised a Chinese company, M/s Sinotec Solar (Pvt) Ltd to consider forming a Joint Venture (JV) with a local company M/s Ghani Glass and start local manufacturing of solar panels in Pakistan.

In this regard Sinotech solar had put forward some conditions to consider local manufacturing. According to sources the representative from Sinotech Solar said that their company will localise the solar cell, having a cost share of almost 60 per cent in the production cost of solar panel, in the next five years from the start of their operations in Pakistan provided that their self-manufacturing reaches 3GW and local manufacturing industry reach to 10GW power producing capacity of solar.

Similarly, he presented the localisation plan of the other five items in the same way with the condition that the local manufacturing industry will reach 20GW in the next three years. He further stated that the value of their imports will be 88 per cent of their total production value with a two percent share of depreciation and only 10 per cent share of value addition.

These conditions have since been rejected by the ministry because the conditions of local market volume of 10GW and 20GW power producing capacity from solar is not logical and practical. Secondly the company is only considering the Pakistani market as their potential client and not considering the international market, as this manufacturing facility will potentially act as a base to export solar panels to the USA market along with rest of the world.

At the conclusion the MoC asked Sinotec Solar Co (Pvt) Ltd to provide a complete and unconditional indigenization plan of five to seven years from the list of imported raw materials parts, inputs, plant and machinery on which duties and tax exemption will be provided by the Government of Pakistan to the Sinotec company with the written agreement backed by a proper bank guarantee after having consultation with M/s Ghani Glass Co (Pvt) Ltd. The EDB will provide the technical evaluation report of the complete indigenisation plan of Sinotec Solar Co (Pvt) Ltd.