At a time when the nation should be focusing on going green, the finance minister has made a blunder by imposing a 10% duty on, of all things, solar panels.
Apparently, this duty comes in response to demands from local solar panel assemblers, who are finding it difficult to compete with cheaper Chinese imports.
The protectionist argument may have made some sense if local assemblers were actually capable of meeting our national demand, which is steadily growing along with the number of large-scale solar installation projects which have already been planned.
But as it stands, such a protective policy is a mistake.
Cheaper solar panels are vital for the viability of long-term investments in solar energy, which stands to benefit millions of Bangladeshi consumers.
And our local assemblers are not even equipped to make panels used for irrigation, so all the progress we’ve made in terms of switching to solar powered irrigation will take a big hit.
The duty will cause a price rise that is likely to seriously set back our goal to generate 10% renewable energy by 2020, and will deprive our citizens of an affordable source of energy.
The protective policy will also discourage the private sector from installing solar panels and that will be a grave loss for the industry.
Prime Minister Modi of India has wisely refused to support local solar panel manufacturers in this way, because there are other ways to help the industry if the government is really serious about it.
We have made remarkable strides in solar power generation so far without import duties all this time, and it would be totally misguided to change that policy right now.