Pakistan’s solar energy sector has experienced significant growth, with the country now boasting a total solar capacity of 32,000 megawatts, achieved through the import of approximately 2.25 billion solar panels. This expansion includes 6,271 MW connected via net metering, allowing consumers to generate and sell electricity back to the grid, and 6,506 MW installed without net metering. Additionally, 5,521 MW of off-grid solar capacity has been established, contributing to the nation’s energy diversification efforts.
Despite this progress, the rapid influx of imported solar panels has raised concerns within the local industry. The Pakistan Solar Association (PSA) has criticized the government’s proposal to impose an 18% general sales tax (GST) on imported solar panels, arguing that it could hinder the adoption of solar energy and adversely affect consumers. The PSA contends that the local manufacturing sector is not yet equipped to meet the demand for high-efficiency solar panels, and such a tax could lead to increased costs for consumers and potentially slow down the transition to renewable energy.
In contrast, some policymakers support the tax, viewing it as a means to promote local manufacturing and reduce reliance on imports. Finance Minister Muhammad Aurangzeb has emphasized that the tax aims to create a level playing field between imported and locally produced solar panels, thereby fostering the growth of Pakistan’s indigenous solar industry.
As the debate continues, the government has clarified that rooftop solar units connected to the grid under net metering will not be subject to the 18% tax. However, consumers will still be required to pay the standard tax on electricity purchased from the grid. e energy adoption and supporting local industry growth. The outcome of this policy decision will have significant implications for Pakistan’s energy landscape and its commitment to sustainable development.
