The government has abolished import duties, regulatory duties, supplementary duties, and advance taxes on essential solar power equipment imports. This is expected to reduce solar power production costs by 25 to 30 percent. However, certain conditions must be met to avail these benefits. This announcement was made by Finance Minister Amir Khosru Mahmud Chowdhury during the proposed budget speech in the Jatiya Sangsad on Thursday.
The removal of duties is expected to provide relief from 30 to 70 percent of duties for the solar power sector. This move is anticipated to create a positive response in investments in the renewable energy sector and enhance energy security in the country. Each megawatt of renewable energy production is expected to create at least 60 jobs, leading to significant employment opportunities in this sector. The goal is to achieve 10,000 megawatts of electricity production from renewable sources within the next five years.
The President of the Bangladesh Sustainable and Renewable Energy Association, Mostafa Mahmud, praised the government's policy decision, stating it demonstrates the government's sincerity towards the renewable energy sector. He emphasized that renewable energy is crucial for sustainable development and encouraged the use of solar power for both industrial and household electricity production. However, he cautioned against the imposition of excessive conditions that could hinder progress.
The duty-free benefits for the solar power sector have been proposed to remain in effect until June 2031. However, for certain products like mounting structures, lithium cells, battery packs, and battery energy storage systems, the benefits will be withdrawn after June 30, 2028, to encourage domestic production and industrial development. The budget speech also proposed providing duty-free benefits for the production of environmentally friendly batteries, including lithium-ion and sodium-ion batteries, until June 30, 2030.
Khondaker Golam Moazzem, Research Director at the Center for Policy Dialogue (CPD), noted that the government has shifted away from its long-standing trend of favoring fossil fuels. He stated that the removal of duties would provide relief to investors and financiers. He suggested that the duty-free benefits for certain products should be maintained until domestic industries are established, possibly extending up to five years.
