SoftBank's founder chairman and CEO Masayoshi Son believes the solar power project will help plug India's power deficit. Additionally, he is also seeking to support Prime Minister Narendra Modi's 'Make In India' vision.
Japanese major SoftBank is planning to invest roughly USD 20 billion for 20 GW solar projects. However, SoftBank's founder chairman and CEO Masayoshi Son says he will keep the commitment as long as the project makes business sense. The timeline of the investment will depend on regulatory clearances ahead, he adds.
He says the project will require cooperation from the Central and state governments as well as public sector units.
According to him, India may be a better investment bet than Japan considering cost of land, labour and construction is lower here. "I have heard there is a lot of unused and uncultivable land in India. There are lots of opportunities in non-agricultural land for solar energy," he told CNBC-TV18.
Son believes the solar power project will help plug India's power deficit. Additionally, he is also seeking to support Prime Minister Narendra Modi's 'Make In India' vision.
SoftBank, leading Indian business group Bharti Enterprises Limited and Taiwan-based top design and manufacturing services provider Foxconn Technology Group, came together with plans to form a joint venture, SBG Cleantech Limited to promote the adoption of clean and safe energy in India. Subject to certain conditions, all three companies will jointly invest in the venture.
Below is the verbatim transcript of Masayoshi Son's interview with Malvika Jain on CNBC-TV18.
Q: By when will you be investing USD 20 billion?
A: Creation of the solar power which is about USD 20 billion of investment. We would like to make it as quickly as possible, it should be at least within the next 10 years. But how quickly we can accelerate or how much can we increase all depends on the Central government, local government, the National Thermal Power Corporation (NTPC), their cooperation and collaboration - land availability, of course all those things we should still look at and study, discuss. This 20 gigawatts, USD 20 billion of investment is our commitment. As long as it makes business sense, I will make commitment to make it happen.
Q: While you did mention that you also undertook your own analysis, a land acquisition continues to be a big challenge. What was your analysis in that regard. Do you think the government has been able to create an environment, has been able to build that kind of trust that it will be able to facilitate land acquisition for investors like you?
A: I have heard a lot of unused land exists in this country. I have done 20 projects in Japan for the solar and renewables. In Japan, the land is so small, it is so crowded, here in this country, it is a big country with a lot of land and unused in the desert area not able to cultivate for any agriculture goods. So, I have heard there are lots of opportunity and lots of electricity demand. So, this makes a lot of sense. The sunshine is two times more than Japan. The cost of creating solar power is half of Japan. Because the land is lower cost, the labour cost is lower, and construction costs, everything including the maintenance is lower. So, if the sunshine is two times more, cost is one half. It makes four times more efficient than japan. So, I said okay, this is a country makes sense to have the largecap investment.
Q: But, despite that, do you think that it will be cost viable for you to manufacture in India even though the cost would be much lesser than in Japan, because still it is not going to be profitable unless you are able to actually bring down the cost substantially further down.
A: So, there are two parts of the investment. One part which we start is we buy the equipments from overseas, from all over the world and then import and construct, we own the solar park, we start generating electricity. So, that is the first project.
The second project is the manufacturing, supporting Make in India legion led by Prime Minister Modi. I would also like to support the legion of Make in India because one third of the cost of the solar park is logistics. It is heavy, it is big. So, if we can help locally manufacture, assemble and manufacture the equipments, then the cost is supposed to go down. That will help the electricity cost go down also. So, it is not only clean good for the environment, but also cost can be reduced. The 100 gigawatts solar power generation would be the largest project in the world. So, India has a lot of sunshine, big land and if this 100 gigawatts vision was exercised, the manufacturing, even the equipments locally here in India makes sense.
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