US scrutiny of solar products from China’s Xinjiang could ‘create opportunities’ for Indian manufacturers
- India has the fifth largest solar power capacity in the world, but it is dependent on imported silicon cells and photovoltaic modules, mainly from China
- The Indian government is trying to boost domestic manufacturing, but companies have to overcome high production costs and a lack of technical experience
US scrutiny of Chinese solar products from Xinjiang could create “viable opportunities” for India’s domestic solar industry, but establishing an integrated supply chain in the South Asian country is still years away, experts say.
Solar companies are increasingly looking to diversify production, especially for polysilicon that is used in solar panels, away from China, which accounts for most of the world’s solar manufacturing.
India, with an installed solar power capacity of 49.3 gigawatts (GW), has the fifth largest solar deployment in the world, but it is almost completely dependent on imported silicon cells and photovoltaic (PV) modules. And China accounts for about 90 per cent of its imports, according to a report by JMK Research and Analytics, a consulting firm.
When announcing new manufacturing incentives for India’s solar industry in November 2020, India’s cabinet – chaired by Narendra Modi – said “large imports of solar PV panels pose risks in supply-chain resilience and have strategic security challenges”.
More recently, demand for non-China polysilicon has been heightened by an “obvious decoupling” between the US and China, said Paul Wormser, vice-president of technology at solar supply chain consultancy Clean Energy Associates.
