Article content

(Bloomberg) — Indian imports of solar power equipment have risen rapidly this year, and the country is still highly reliant on foreign suppliers despite Prime Minister Narendra Modi’s efforts to increase self-sufficiency, according to BloombergNEF.

Solar panel imports hit an 18-month high in September, while purchases of photovoltaic cells in value terms in the first nine months of this year were higher than for the whole three years through 2022, BNEF said in a report released Friday. The country is particularly dependent on its geopolitical rival China, which has produced 57% to 100% of Indian imports of products including modules, cells, wafers and solar glass since the start of 2021, it said.

Article content

India’s predicament highlights the dominant role of China in many energy transition technologies. New Delhi’s move to try and become more self-reliant in solar technology and also build an export industry dates back to 2020, when the pandemic disrupted supply chains. Increasing tensions with Beijing possibly played a part as well. Since then, India has used a mix of trade barriers, domestic content requirements and subsidies to incentivize local manufacturing.

The country is targeting a rapid increase in the proportion of solar in its coal-dominated electricity mix, from around 17% of capacity now to almost 39% by 2032. In terms of solar module manufacturing, it’s aiming to lift capacity to 100 gigawatts a year by the end of 2026, about five times the current level shown in the government’s latest approved list. 

There’s been a rapid acceleration in India’s solar manufacturing capacity, but measures to increase self-reliance have not succeeded in an industry with fast-evolving technology and volatile prices, BNEF said. Around two-thirds of India’s consumption of cells and 100% of wafers came from imports since the start of 2021, and this is unlikely to fall in 2024, it said. 

Some Indian manufacturers are concerned about Beijing potentially restricting the export of machinery to make wafers, cells and modules, according to BNEF.

India currently doesn’t produce any wafers or polysilicon. Adani Enterprises Ltd. said last month it had completed a pilot plant to make solar ingots and produced the country’s first wafers. The Gautam Adani-backed conglomerate, along with Reliance Industries Ltd. and Shirdi Sai Electricals Ltd., plan to build India’s first fully integrated solar manufacturing facilities.

Share this article in your social network