India's Finance Ministry to Review Customs Benefits for Battery Storage Imports
Finance ministry may review MOOWR benefits for battery storage imports
The Economic TimesImage: The Economic Times
The Finance Ministry of India may consult with the Ministries of Power and Renewable Energy regarding the continuation of customs warehousing benefits under the Manufacture and Other Operations in Warehouse Regulations (MOOWR) for imported battery energy storage systems. This review comes amid concerns from the renewable energy sector about unfair advantages for certain developers.
- 01The Finance Ministry is considering a review of customs benefits for imported battery storage systems.
- 02Concerns have been raised about an uneven playing field between developers using MOOWR benefits and those importing under normal customs duties.
- 03The MOOWR scheme allows deferred customs duties and GST, significantly reducing upfront costs.
- 04Industry representatives claim some developers misuse the scheme by deploying imported systems directly in domestic projects.
- 05The review aims to align with India's energy security goals and ensure fair competition in the renewable energy sector.
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The Finance Ministry of India is set to discuss the future of customs warehousing benefits under the Manufacture and Other Operations in Warehouse Regulations (MOOWR) scheme for imported battery energy storage systems. This comes after concerns from the renewable energy sector regarding potential misuse of the scheme, which allows companies to defer customs duties and goods and services tax (GST) until goods are cleared for domestic use or export. Industry representatives, including the Associated Chambers of Commerce and Industry of India and the India Energy Storage Alliance (IESA), have raised alarms that some developers are importing fully assembled battery systems under the MOOWR scheme and deploying them directly in domestic projects, thereby gaining an unfair pricing advantage. The revenue department is currently examining these claims and is open to addressing any policy gaps to ensure that the benefits of the scheme reach the intended recipients. A senior official indicated that consultations with relevant ministries will take place soon, with any final decisions being made in alignment with India's energy security objectives.
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This review could lead to changes in how battery storage systems are imported, potentially affecting the pricing strategies of developers in the renewable energy sector.
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