TERI report on India’s PV manufacturing landscape
Kartavya Desk Staff
Source: TERI
Subject: Economy
Context: TERI released “India’s PV Manufacturing & Its Strategic Inflection Points” at Bharat Climate Forum 2026, alongside the launch of the National Cleantech Manufacturing Implementation Plan, spotlighting how India can capture more value from its solar boom.
About TERI report on India’s PV manufacturing landscape:
What it is?
• A strategic, policy-and-industry assessment of India’s solar PV manufacturing value chain (from polysilicon → ingots/wafers → cells → modules), identifying inflection points where targeted policy, finance, R&D and skilling can make India globally competitive and resilient.
Key trends highlighted:
• Global PV scale + China concentration: Global cumulative PV hit ~2.2 TW (end-2024); module manufacturing capacity projected ~1.8 TW by end-2025, with ~80% concentrated in China across the full chain.
• China’s dominance is near-monopoly upstream: China’s market shares are extremely high (e.g., ~98% wafers, ~92% polysilicon, ~91.8% cells, ~84.6% modules).
• India’s current position is downstream-heavy: India’s FY2025 manufacturing is “anchored” in modules; module assembly capacity ~120 GW/year.
• Policy has driven module scale-up: Expansion is linked to PLI, high import tariffs on finished panels, and ALMM creating domestic demand-pull.
• Ambition to scale fast by 2030: India’s module capacity is projected to exceed ~280 GW/year by 2030, with cell capacity rising from ~30 GW to ~171 GW/year.
• Finance is the make-or-break enabler for upstream: The report proposes sovereign “Green PV Bonds” to lower borrowing costs.
• Need for ecosystem: It recommends Solar Manufacturing Technology Parks and a PV–Semiconductor Skill Council; also highlights structured recycling/circularity roles for governments, OEMs, developers, MSMEs and investors.
Opportunities:
• Upstream value capture (polysilicon→wafer→cell integration) India already has ~120 GW/yr module capacity and plans steep scale-up by 2030; building upstream alongside this demand can retain value domestically.
• India already has ~120 GW/yr module capacity and plans steep scale-up by 2030; building upstream alongside this demand can retain value domestically.
• Low-cost capital advantage via “Green PV Bonds”: TERI suggests a dedicated Green PV Bond pool to on-lend at 4–5%, improving bankability of capital-intensive fabs/equipment purchases.
• TERI suggests a dedicated Green PV Bond pool to on-lend at 4–5%, improving bankability of capital-intensive fabs/equipment purchases.
• Innovation clusters + pilot fabs to leapfrog technology: Proposed Solar Manufacturing Technology Parks with shared testing labs/clean rooms/pilot fabs can speed commercialisation (as seen in global cluster precedents cited).
• Proposed Solar Manufacturing Technology Parks with shared testing labs/clean rooms/pilot fabs can speed commercialisation (as seen in global cluster precedents cited).
• Circularity and ESG-driven new markets: Report outlines stakeholder roadmap and calls for PV recycling associations, take-back programs and ESG-linked financing—opening a new Indian cleantech industry layer.
• Report outlines stakeholder roadmap and calls for PV recycling associations, take-back programs and ESG-linked financing—opening a new Indian cleantech industry layer.
Key challenges:
• Over-reliance on imported upstream inputs and concentrated global supply: With China holding ~98% wafer and ~92% polysilicon share, any disruption can hit India’s deployment/manufacturing continuity.
• With China holding ~98% wafer and ~92% polysilicon share, any disruption can hit India’s deployment/manufacturing continuity.
• Cost of capital + risk perception for upstream fabs: TERI explicitly notes the need for risk-sharing tools and concessional structures (NIIF/DFIs/hedges) because normal financing is too expensive for mega plants.
• TERI explicitly notes the need for risk-sharing tools and concessional structures (NIIF/DFIs/hedges) because normal financing is too expensive for mega plants.
• Equipment/tool-chain chokepoints and FX exposure: The report recommends a cross-currency hedge facility (via RBI/SBI concept) because equipment imports expose fabs to rupee depreciation and project instability.
• The report recommends a cross-currency hedge facility (via RBI/SBI concept) because equipment imports expose fabs to rupee depreciation and project instability.
• Sustainability compliance and end-of-life management gaps: It calls for take-back programs, industry recycling associations, and decommissioning planning—implying current recycling infrastructure is insufficient for scale.
• It calls for take-back programs, industry recycling associations, and decommissioning planning—implying current recycling infrastructure is insufficient for scale.
Way ahead:
• Create upstream-ready ecosystems via Solar Manufacturing Technology Parks: Set up parks in PV-heavy states (e.g., Gujarat, Tamil Nadu) with shared labs/clean rooms/pilot fabs to cut time-to-market for new processes.
• Set up parks in PV-heavy states (e.g., Gujarat, Tamil Nadu) with shared labs/clean rooms/pilot fabs to cut time-to-market for new processes.
• Deploy “Green PV Bonds” + blended finance for scale: Use Green PV Bonds and NIIF/DFI blended finance to lower borrowing costs and crowd-in private equity for polysilicon/wafer/glass/equipment.
• Use Green PV Bonds and NIIF/DFI blended finance to lower borrowing costs and crowd-in private equity for polysilicon/wafer/glass/equipment.
• Build a PV–Semicon workforce pipeline: Establish a dedicated Skill Council to accredit modular training via ITIs/polytechnics/corporate academies and publish a rolling 10-year roadmap aligned to capacity targets.
• Establish a dedicated Skill Council to accredit modular training via ITIs/polytechnics/corporate academies and publish a rolling 10-year roadmap aligned to capacity targets.
• Mainstream circularity: TERI notes MNRE has identified PV recycling as a priority and proposes consortia for recovery of silicon/silver/glass plus state-level pilot take-back programs.
• TERI notes MNRE has identified PV recycling as a priority and proposes consortia for recovery of silicon/silver/glass plus state-level pilot take-back programs.
Conclusion:
India must now move beyond modules to build upstream capacity, equipment, and finance. TERI’s roadmap of parks, skills, and blended finance cuts import risks and boosts competitiveness. This can anchor Atmanirbhar cleantech with jobs, resilience, and exports.
Q5. “Solar energy expansion in India faces constraints that are structural rather than technological.” Evaluate the structural constraints affecting large-scale solar deployment and their implications for India’s long-term energy security. Suggest measures to overcome these constraints. (15 M)