Has the sun finally started shining on India's solar industry?
China for solar energy equipment. With nearly 90% of it being imported from China, India has been in a hurry to build up domestic manufacturing capacity under Make-in-India programme and with the ambitious scheme of Production-linked Incentives (PLI).
Now, India's solar economy seems to be slipping out of China's grip.
India’s solar module imports from China reduced nearly 80% by $2 billion in the first half of 2023, according to Chinese export figures collated by energy think tank Ember. The total solar module imports declined 76% to 2.3 GW between January and June 2023 from 9.8 GW in a similar period from a year ago, according to an ET analysis of Ember’s data, A report by the New Delhi-based Global Trade Research Initiative says the imports of solar cells, parts and diodes from China dropped 70.9% in 2022-23.
The Chinese supremacy
China supplies nearly three quarters of the world’s solar panels.
It had an early mover advantage when it started to grow its solar industry more than a decade ago. It established an end-to-end supply chain — the country now makes most of the world’s polysilicon, a key material in solar panels — and ignored pleas by environmentalists to close coal plants that supply the cheap electricity needed to make solar equipment, as per a Bloomberg report.
It also kept its labor costs lower than those in most industrial countries and has been willing to prop up unprofitable operations.U.S. companies, which 20 years ago made 22% of them, now produce just 1% on American soil, according to Jenny Chase, head of solar analysis at BloombergNEF.
At one point there were 75 major solar parts factories in the U.S., a number that was expected to grow as the industry flourished. Most have since been shuttered,
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