Long waits for domestic solar cells have forced many Indian panel factories to pause production. The disruption could imperil thousands of jobs and billions in investment.
As informed by Reuters
Indian solar panel manufacturers are being forced to idle factories due to long queues for domestic components needed to replace imports from China as part of government efforts to boost local production, according to industry sources.
Disruptions caused by the enforcement of the relevant rules on June 1 threaten thousands of jobs and about $4 billion in investments, according to manufacturers and analysts, while jeopardizing India’s 2030 target to increase solar power capacity.
“We have faced significant difficulties due to the lack of domestic solar cells over the past three months.”
– Shailendra Shukla
Nearly a third of the 140 small and medium solar module manufacturers, which account for 60% of capacity, have halted production, while others have shortened cycles to three-to-four days, according to the All India Solar Module Manufacturers Association.
Manufacturers without their own cell-fabrication capacity report waits of six to eight months for domestic cells, causing the cost of panels manufactured domestically [sic] to rise almost twice as much as those using Chinese cells.
The Ministry of Energy in the Clean Energy sector said it had not received official notices of production stoppages from independent module manufacturers, but is watching prices and expects to secure adequate cell production within six months.
However, India faces challenges in ramping up supply as building high-tech cell-manufacturing plants takes time, and China restricts export of technology, equipment, and technical support for the solar industry, industry sources say.
Supply disruptions would push back solar projects and raise costs, potentially slowing India’s plan to reach 500 GW of renewable energy capacity by 2030, industry sources and analysts warn, given that it currently stands at around 288 GW.
Rising demand for electricity means that slower deployment of solar energy will have to be offset by greater use of fossil fuels, primarily coal, delaying the transition to cleaner energy.
Solar energy accounts for about 29% of India’s current non-fossil capacity and is forecast to grow to over 292 GW by 2030 from 162 GW today, according to the Central Electricity Authority.
Although India has built around 200 GW of panel manufacturing capacity, the actual output of solar cells is only about 27 GW, government estimates show.
The real-world picture reveals an even bigger gap: the effective cell production capacity stands at roughly 16–18 GW, according to EUPD Research and the industry.
According to experts, the official figures reflect installed or nominal capacity, much of which is not yet commissioned or operates well below nominal.
“India is facing a significant shortfall in cell supply, and closing this gap is likely to take three to five years.”
– Ryan Kalsotra
“Over time, China may seek to maintain dominance in the solar industry, where it already wields strong influence in nearly all manufacturing segments,” said Cosimo Ries, an analyst at the consulting firm Trivium China.
The Chinese Ministry of Commerce did not respond to requests for comment. Industry estimates say China controls about 95% of India’s solar cell imports, and imports from China rose about 37% in the last financial year to around $1.86 billion.
At least three module manufacturers Reuters spoke to have temporarily halted production due to a lack of domestic cells, and another four have cut capacity to about a third.
Building new cell manufacturing capacity takes significantly longer than the government expects, manufacturers say.
“It is not possible to start cell production with only an 18-month lead time due to the complexity of the technology and the needs for land and raw materials.”
– Chetan Shah
He was referring to the government deadline for using domestic solar cells, which had been set for June 2026 and had previously been slated for December 2024.
India pushed the date to December 2026 for certain projects amid concerns about shortages and the need to safeguard manufacturers’ investments.
The manufacturers association said such concessions would provide limited help if they do not apply to the entire industry.
Standalone module manufacturers without cell fabrication capacity employ about 75,000 people, of which 45,000 are in Gujarat, where a number of plants are located, according to the state industry group.
Energy leaders forecast that near-term capital costs could rise by about 35% before domestic cell manufacturing capacity reaches the required scale, said Pinaki Bhattacharya, executive director of AMPIN Energy Transition.
Despite all the problems, government efforts to support domestic production continue to shape the new value chain in India’s solar sector, while underscoring the need for long-term solutions to ensure stable and affordable supply as the transition to cleaner energy proceeds.

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