The Centre is preparing an incentive scheme to support domestic polysilicon manufacturing, taking its localisation push deeper into the solar supply chain as it seeks to reduce dependence on imports, particularly from China, according to Reuters.
The support scheme would encourage manufacturers to enter polysilicon production, a critical upstream input used in solar photovoltaic manufacturing, New and Renewable Energy Secretary Santosh Kumar Sarangi was quoted as saying by PTI.
“We are coming up with a support scheme for manufacturing of polysilicon in the country, and we should be able to come up with something which will support our manufacturers to dive deeper into polysilicon manufacturing,” Sarangi told PTI at the 7th CII International Energy Conference & Exhibition in New Delhi.
The proposed scheme could support more than 10 GW of polysilicon manufacturing capacity, Reuters reported, although the government has yet to disclose the size of the financial incentive.
The move would extend India’s manufacturing push to one of the few major links in the solar value chain where domestic capacity remains limited.
Plugging the missing link in solar manufacturing
Polysilicon sits near the beginning of the conventional solar manufacturing chain. It is converted into ingots, which are sliced into wafers. The wafers are then processed into solar cells before being assembled into modules.
As per a report published by Reuters, while India has rapidly expanded module and cell manufacturing over the past few years, the nation continues to depend heavily on imports for several upstream materials and components.
Meanwhile, China dominates global manufacturing across much of the solar supply chain, making diversification an increasingly important energy-security consideration for countries seeking to expand renewable capacity.
The International Energy Agency has previously estimated China’s share of manufacturing capacity across major stages of solar panel production at more than 80%. India currently depends entirely on China for its polysilicon requirements, Reuters reported.
That dependence has prompted the government to increasingly focus on building an integrated end-to-end domestic supply chain rather than restricting its manufacturing policy to finished solar modules.
Module capacity crosses 213 GW
Sarangi said India has now emerged as the world’s second-largest solar module manufacturer, with installed manufacturing capacity exceeding 213 GW. In solar cells, the country has achieved 32 GW of installed capacity, he stated.
“We are looking at 100 GW of solar cell manufacturing capacity to come up by another one year. We are expecting at least 80 GW of ingot wafer manufacturing capacity by June 2028,” the government secretary added.
Taken together, these targets indicate a shift in policy from building primarily downstream assembly capacity towards establishing an end-to-end solar manufacturing ecosystem covering polysilicon, ingots, wafers, cells and modules.
Manufacturing push tied to 500-GW goal
The localisation drive is gathering pace alongside India’s rapid expansion in clean-energy installations. Citing government data, Sarangi said India crossed 300 GW of installed non-fossil fuel power generation capacity by the end of July and remains on course to meet its target of 500 GW by 2030.
India’s 500-GW target has made solar manufacturing strategically important because solar is expected to account for a large share of new capacity additions over the remainder of the decade.
As per experts interviewed by Reuters, the recent initiative undertaken by the government plans to eliminate import dependence on China while building domestic manufacturing ecosystems for the creation of polysilicon, wafers and other upstream inputs in India.
Sarangi said deeper domestic manufacturing would strengthen both India’s clean-energy ambitions and industrial competitiveness. Polysilicon also has applications in semiconductor manufacturing, potentially widening the economic benefits of building domestic production capabilities, he said.
