Fozia Azam

Pakistan's government must prioritise formulating a concrete policy to foster local manufacturing of cheaper solar panels and allied equipment, said a renowned expert in solar energy. “Such a plan could revolutionise Pakistan's renewable energy landscape, and boost the country's economy with a potential to create thousands of jobs in local value-added manufacturing,” said Mustafa Abdullah, Chief Executive Officer at Moro Private Company Limited, while talking to WealthPK. He opined that by removing customs duty on raw material required for manufacturing of solar panels and allied equipment in the Finance Bill 2023-24, the government has shown seriousness towards prioritising the promotion of local manufacturing.

“But the government also needs to develop a well-coordinated solar policy framework to encompass the solar panels manufacturing sector, and it must devise a plan for a specific time period in order to ensure quality and discourage monopoly,” he suggested. Mustafa said that like other developing nations worldwide, Pakistan urgently needs to accelerate its shift towards renewable energy in its power generation portfolio to meet its growing energy needs sustainably. “Solar energy, in particular, offers the country significant potential to achieve this, but the progress to date has been slow due to inadequate policy action, weak investment climate, and limited attention to the energy planning process,” he added.

He said a policy in this regard will help initiate transition, and promote domestic industrial development, as at present investors do not have adequate policy guidelines to understand the long-term profitability and sustainability of solar technologies, thus creating an environment not favourable to long-term investments in the solar industry. “A unified solar policy framework would address these gaps and streamline individual nations' efforts to achieve realistic objectives in this regard,” he added. Mustafa said manufacturing solar panels domestically has many advantages compared to imports, including reducing costs, creating jobs, and supporting local industries.

He said the benefits of solar panels production go beyond just environment-friendly energy production, as domestic manufacturing is also crucial in providing employment opportunities across a range of industries. He emphasised that domestic production helps create jobs in research and development, project financing, operations management, logistics, and transportation. “In the wake of the current energy crisis, the governments is making significant strides in promoting sustainable energy usage, among other initiatives, to lessen the impact of climate change,” he added.

Credit: INP-WealthPk