City-based solar module manufacturer — Vikram Solar — on Tuesday said it has set up a 1.3GW (Gigawatt) solar photovoltaic module plant at Indospace Industrial Park, Oragadam, Tamil Nadu.

The capital investment for the initial phase of the plant is Rs 200 crore. With the new unit, the company’s cumulative PV module manufacturing capacity will reach 2.5GW, including its existing 1.2GW facility at Falta in Bengal. The plant will help to manufacture advanced high-efficiency bi-facial & smart modules. Proximity to the seaport will make transportation cost effective. The company plans to expand further in Chennai.

“We are looking at a complete integrated play where we can insource many of the components required for solar modules. The total outlay would be about Rs 5,000 crore, including debt and equity, put together over five years,” said Saibaba Vutukuri, CEO of Vikram Solar.

The expansion comes at a time the safeguard duty of 25 per cent on solar cell imports is due to end this month. The levy protected domestic manufacturers against imports, particularly from China. “Safeguard duty is sunsetting at the end of this month. It will definitely impact the manufacturers but considering the strong order book, we should be able to mitigate this,” said Gyanesh Chaudhary, managing director, Vikram Solar.

Chaudhary added that the introduction of customs duty on imported solar cells and modules was a good start towards creating a domestic manufacturing ecosystem, but may not be sufficient to ward off Chinese imports.