There is a lot of solar panels in Pakistan at the moment. According to a Bloomberg NEF report, 13 GW of solar panels were imported from China in the first half of 2024. According to one project developer, importing such a large number of solar panels resulted in solar panels being “seen on the roads.” In 2023, the demand for solar panels in Pakistan is about 3.5 GW, and in early 2024, Pakistan will be the target for Chinese solar exports. became the third largest market.
Muhammad Mujahid, executive director of Innovo Corp, said that in 2022, Pakistan’s central bank faced a dollar shortage, leading to a trade deficit and an informal ban on imports. Only essential goods such as medicine and food could be imported, which meant that distributors were unable to bring in solar panels for nearly nine months.
Despite these restrictions, some solar panels were imported. Generally, a letter of credit (LC) is required from the importer’s bank to import goods. However during the foreign exchange crisis in 2022, issuance of LCs was limited. This situation provided an opportunity for the big players in the market to take advantage.
Hussain Khan of Wateen Energy Solutions said that the direct cost of importing the panels was $0.15 per watt while they were being sold at $0.30 per watt in the local market, a 100 percent profit in the trading business. Seeing the profit rate, everyone started ordering solar panels. Companies that were also exporting rice ventured into this business. For example, they exported rice and now they could bring their dollars back from other countries and suddenly the distribution of solar panels increased significantly.
Mohammad Mujahid said that selling solar panels was not a problem and no experience was necessary, meaning you could produce Grade A. It was not difficult to amortize solar panels from companies and sell them in the local market.