rajkot gujarat is the second largest market in manufacturing and sale of solar water heaters after karnataka in the state rajkot is the hub of manufacturing solar water heaters however after the rate of gst was hiked from 5 to 12 the industry received a major jolt the third since 2009 owing to the government policy though solar water heaters are mainly installed by residential units to heat water the other major buyers of these heaters include hotels hostels and hospitals while people who live in individual houses also install this system to save on electricity or gas geysers the civic bodies too have been encouraging the builders to install such heaters in the newly constructed flatsgujarat has around 50 factories manufacturing these solar water heaters in rajkot and gondal the 7 rise in gst rates across the category has irked the industry players this is an energy saving device and largely used by middle class residential consumers gujarat is the second largest market after karnataka but tax burden is discouraging people buying solar water heaters said jaideep malaviya secretary of solar thermal federation of india stfi adding that as a result of this in a letter to the finance minister stfi argued that each 100 litre capacity solar water heater saves 15 tonne co2 annually and assist in meeting indias target of reducing carbon emissionprior to the gst regime there was no vat levied on solar water heaters after gst was introduced 5 tax was imposed on the products rigal patel a rajkotbased manufacturer told toi other solar products enjoy subsidies but the 30 subsidy given on water heaters has been discontinued since 2014 between 2009 and 2014 there was huge business owing to the subsidy however imposition of 5 gst hampered the growth and now the 12 gst will discourage even more people from installing heaters the market value of a basic 100litre capacity water heater is around rs 15000 the 200litre capacity is most popular among the category and suffices for a family of around 6 persons and is also comparatively costeffective priced at around rs 25000 hotels and big hospitals install solar water heaters with capacities of 1000litres