In spite of Prime Minister Narendra Modi's efforts to improve self-sufficiency, BloombergNEF reports that India has seen a significant increase in the imports of solar generating equipment this year.
Imports of solar panels peaked in September after an 18-month decline, and the total amount spent on photovoltaic cell purchases in the first nine months of this year was more than that of the three years preceding 2022.
Since the start of 2021, China has accounted for between 57 per cent and 100 per cent of India's imports of various solar items, demonstrating the country's continued reliance on foreign sources.
In light of India's efforts to develop an export economy and increase self-sufficiency in solar technology, this circumstance highlights China's considerable impact in the field of energy transition technologies.
India's efforts in this direction, initiated in 2020 due to pandemic-related disruptions and escalating tensions with Beijing, have involved employing trade barriers, domestic content requirements, and subsidies to stimulate local manufacturing.
Despite a rapid increase in India's solar manufacturing capacity, BloombergNEF noted that endeavours to achieve self-sufficiency face challenges in an industry characterised by rapidly evolving technology and fluctuating prices.
The country aims to substantially increase the share of solar in its predominantly coal-driven electricity mix from 17 per cent to nearly 39 per cent by 2032. Regarding solar module manufacturing, the target is to elevate capacity to 100 gigawatts per year by the end of 2026, a fivefold increase from the current government-approved level.
In spite of these hopes, since the beginning of 2021, almost two-thirds of India's cell consumption and all of its wafer usage have come from imports, and this trend is expected to continue until 2024, as reported by Bloomberg.
Indian businesses are worried that Beijing would impose export restrictions on the equipment needed to make wafers, cells, and modules.
Although recent advancements by companies such as Adani Enterprises suggest progress in this regard, India does not currently manufacture wafers or polysilicon. Adani Enterprises intends to build the first fully integrated solar manufacturing facilities in India in collaboration with Reliance Industries and Shirdi Sai Electricals.