India’s Solar Export Surge: Leveraging Domestic Manufacturing for Global Growth

In recent years, India has become a key player in the global solar photovoltaic (PV) market due to its abundant sunlight and strong commitment to renewable energy. Two Harmonized System of Nomenclature (HSN) codes, 85414200 and 85414300, are crucial for India’s solar export growth. HSN code 85414200 covers photovoltaic cells not yet assembled into modules or panels, while HSN code 85414300 refers to cells that are assembled into finished solar panels.

In 2024, India’s export of solar modules has notably increased, with more panels being sent to the US than to any other market. Despite this growth, there’s a gap between the production of solar modules and cells. India excels in manufacturing solar modules but struggles with producing enough solar cells competitively. This issue has led to government actions like the Approved List of Models and Manufacturers (ALMM), which aims to boost domestic solar panel production and enhance export opportunities.

The ALMM, introduced on April 1, 2024, has already shown results. Solar module exports soared to ₹95,399.1 lakh in May 2024. This policy prioritizes domestically made solar panels for government projects and incentives, encouraging local manufacturers to increase production and align with India’s renewable energy goals. In the first five months of 2024, India’s total solar PV exports exceeded ₹8,11,621.96 lakh, with solar modules contributing ₹8,05,409.13 lakh and solar cells ₹6,212.83 lakh.

While ALMM supports domestic production, it has raised concerns among solar project developers about potential impacts on pricing. Some believe that export restrictions might help keep domestic prices competitive. However, the focus on boosting domestic manufacturing, supported by ALMM, creates a favorable environment for Indian manufacturers. With growing domestic demand for solar panels, manufacturers have a chance to expand and offer competitively priced products abroad.

India’s strong position in solar module manufacturing provides a significant advantage in meeting global solar energy demands. By leveraging its manufacturing capabilities and technological advancements, India is set to become a leading exporter of solar panels and components. The country’s dedication to sustainability and alignment with global decarbonization goals further support its role in the global transition to renewable energy. India’s growth in solar exports, driven by technological progress and supportive policies, positions it to play a major role in sustainable development and economic advancement worldwide.