China's indigenous innovation and First Solar’s Indian foray

India aims to be a solar power by 2022 with 22 GW of solar generation capacity target. Companies like First Solar and Astonfield are foraying in the Indian solar market. But their strategic alliance with China for manufacturing thin films might increase the risk for Indian power sector which is increasingly sourcing power equipment from China.

Forbes reported that :

First Solar, a leading thin-film solar company based in Phoenix, has signed a “strategic cooperation framework agreement” with state-owned China Power International New Energy Holding (CPINE).

First Solar’s Dangerous Game - Forbes: "Under China’s innovation policy, foreign firms like First Solar are allowed to participate in government procurement opportunities if they agree to transfer core technologies to Chinese-owned companies.

The extent of China’s “indigenous innovation” policies is alarming. Alan Wolff, a partner at the law firm of Dewey & LeBoeuf, told the Commission:

When the word went forth from the highest levels that “indigenous innovation” was a central precept of Chinese industrial policy, ministries and government agencies throughout China began to translate the policy into reality, especially in the area of government procurement . . . The U.S. China Business Council as of February of this year identified 61 indigenous innovation catalogues at the provincial and municipal level, and noted that in Shanghai’s catalogue, of 523 products made in China only two appeared to involve foreign companies, and in these two cases, the companies were joint ventures with majority Chinese partner ownership.

Although First Solar has publicly denied being strong armed, the company’s recent history in China has all the trappings of exactly the sort of IP-squeeze described by U.S. industry groups and intelligence sources."