India's solar panel exports plummet as Trump's tariffs bite
What's the story
India's solar module exports have witnessed a steep decline in September, hitting their lowest point this year. The fall comes after US trade measures restricted shipments, forcing manufacturers to turn their focus to the domestic market. Earlier this year, India's exports to the US had skyrocketed as developers looked for alternatives to Chinese panels amid Washington's restrictions on Chinese products.
Trade restrictions
US tariffs and scrutiny impact Indian solar exports
The US, which accounted for over 90% of India's module exports earlier this year, imposed a 50% tariff on Indian goods earlier this year. The country has also stepped up its scrutiny on imports as it probes whether Chinese-made components are being routed through India. This has had a major impact on India's solar module exports to the US.
Export figures
September sees a sharp decline in solar module exports
Government data shows that India's solar module exports fell sharply in September, falling to about $80 million from $134 million in August. The decline is attributed to the US's trade measures and tariff imposition, which have affected some players in the industry. Girishkumar Kadam, senior vice president at ratings agency ICRA, said these risks have materialized for certain companies.
Manufacturing capacity
India's solar module manufacturing capacity and future projections
India's approved solar module manufacturing capacity is about 110 gigawatts (GW) and is expected to exceed 165 GW by March 2027, ICRA said. However, the slowdown in overseas demand has sparked fears of oversupply in the domestic market. This is particularly concerning as annual solar installations are still below the required levels to meet renewable targets for 2030.
Market adaptation
Industry response to market challenges
In light of these challenges, analysts expect consolidation among smaller module-only firms as margins come under pressure. Vertically integrated players with cell and wafer capacity are likely to weather the downturn better. In August, the All India Solar Industries Association had urged the Indian Banks's Association to stop funding new, unviable module manufacturing projects to avoid future bankruptcies.