India emerges as key solar module supplier to US amid global supply chain shift

By Admin

31 Dec, 2025

Global Solar Tariffs Continue to Decline
Solar power tariffs are falling worldwide, driven by rapid technological innovation, improved efficiencies, and large-scale adoption across major economies. As clean energy becomes more affordable, global demand for solar equipment has surged, reshaping supply chains and creating new opportunities for emerging manufacturing hubs.

US Turns to India Amid Supply Chain Realignment
According to a report by PL Capital, India’s solar manufacturing industry is witnessing strong momentum, with the United States emerging as its largest export destination. This shift has been primarily driven by US restrictions on imports linked to Chinese supply chains. Between 2023 and 2025, the US accounted for nearly 97 per cent of India’s solar module exports, underlining a significant realignment in global solar sourcing.

Exports Surge, India Gains Global Credibility
The report highlights a sharp rise in outbound shipments, with India’s solar module exports increasing nearly nine-fold in 2023 and doubling again in 2024. This rapid growth positions India as a credible and reliable alternative supplier in the global solar value chain, especially for markets seeking to diversify away from China-centric sourcing.

Cost Advantage Drives Demand
Cost competitiveness has been a major factor strengthening India–US trade ties in the solar sector. Indian solar modules are estimated to be 19–21 per cent cheaper than those manufactured in the US, making them highly attractive to American buyers. However, competition remains intense. India’s share of US solar imports rose from 3 per cent in 2022 to 11 per cent in 2024, while Vietnam continues to lead with a 36 per cent market share, followed by Malaysia.

Strong Growth in the US Solar Market
The US solar sector marked a milestone year in 2024, adding nearly 50 GW of new capacity. This growth has been supported by robust federal and state-level incentives aimed at accelerating clean energy adoption and strengthening domestic manufacturing capabilities.

Fresh Challenges for Indian Manufacturers
Despite export success, Indian solar manufacturers face new headwinds. The US government has initiated investigations into alleged dumping, citing margins of up to 123 per cent for Indian products. Additionally, a 50 per cent tariff on certain Indian imports is scheduled to take effect from August 2025, including penalties linked to India’s continued oil imports from Russia. These developments raise concerns as the US intensifies efforts to build its domestic solar manufacturing base.

India Scales Up Renewable Infrastructure
On the domestic front, India continues to expand its renewable energy ecosystem. Total power generation capacity grew from 356 GW in 2019 to 475 GW in 2025, largely driven by renewables. Renewable installations are projected to reach 430 GW by 2030, with solar power contributing a significant share.

Manufacturing Capacity Set to Soar
India’s solar module manufacturing capacity is expected to touch 180 GW by 2030, backed by strong government initiatives aimed at positioning the country as a global leader in renewable energy manufacturing and exports.

The Road Ahead
As global supply chains shift and clean energy demand accelerates, India stands at a critical juncture. While export opportunities to the US have grown rapidly, navigating trade barriers and geopolitical challenges will be key to sustaining momentum. With expanding capacity, competitive costs, and policy support, India remains well-placed to strengthen its role in the global solar manufacturing landscape.