India ranks 3rd globally in renewable energy capacity, solar upstream gap persists
Synopsis
India hit a landmark — 50% non-fossil energy capacity five years ahead of schedule — but a Morgan Stanley report flags a critical blind spot: upstream solar manufacturing in cells, wafers, and polysilicon still leans heavily on China. Fixing that supply chain gap may determine whether India's green transition truly reduces macro vulnerability or just swaps one import dependency for another.
Key Takeaways
India is now ranked 3rd globally on installed renewable energy capacity, per a Morgan Stanley report.
Non-fossil installed capacity crossed 262.7 GW as of November 2025 , surpassing 50% of total capacity — five years ahead of schedule.
Domestic solar module capacity rose from 38 GW to 74 GW and cell capacity from 9 GW to 25 GW between March 2024 and March 2025 .
In FY2025 , India imported approximately 35 million solar modules worth around $1.6 billion , with an estimated 60–80% sourced from China .
India's 2030 NDC target calls for 500 GW of non-fossil capacity; the country is now more than halfway there.
India has climbed to third place globally on installed renewable energy capacity, but a new Morgan Stanley report warns that the full macroeconomic benefit of this transition will hinge on the country's ability to localise upstream manufacturing segments — particularly solar cells, wafers, and polysilicon — over time. The report, released in May 2025, positions renewable energy as the central pillar of India's medium-term strategy to structurally reduce external energy dependence.
Where India Stands Today
India's non-fossil installed capacity has crossed 50 per cent of total capacity, reaching 262.7 GW as of November 2025. Solar energy accounts for 132.9 GW of that figure, while wind contributes 54 GW, together driving the bulk of incremental additions. Notably, India achieved the 50 per cent non-fossil milestone a full five years earlier than originally anticipated, supported by utility-scale expansion, distributed generation programmes such as PM Surya Ghar and PM-KUSUM, and sustained policy backing for grid integration.
Domestic Manufacturing: Rapid Growth, Persistent Gaps
Domestic module manufacturing capacity has scaled rapidly, aided by Production-Linked Incentive (PLI) schemes and customs duties. Data from the Ministry of New and Renewable Energy (MNRE) shows module capacity nearly doubling from 38 GW in March 2024 to 74 GW in March 2025, while cell capacity expanded from 9 GW to 25 GW over the same period.
However, the gains are concentrated in downstream segments. According to the Morgan Stanley report,
Point of View
But the Morgan Stanley report surfaces an inconvenient structural truth: swapping fossil fuel imports for solar component imports from China is a risk substitution, not a risk elimination. The PLI push has moved the needle on module assembly, but cells, wafers, and polysilicon — the higher-value, higher-complexity layers of the solar stack — remain largely outside India's domestic capability. Until those segments are indigenised, a geopolitical or trade disruption in the China supply chain could stall India's energy transition as surely as an oil price shock. The 500 GW target by 2030 is achievable on deployment; the harder question is whether it will be built on a sovereign supply chain or a borrowed one.
NationPress
11 May 2026
Frequently Asked Questions
What is India's current global rank in renewable energy capacity?
India ranks third globally on installed renewable energy capacity, according to a Morgan Stanley report released in May 2025. The country's non-fossil installed capacity reached 262.7 GW as of November 2025, crossing 50% of total installed capacity.
Has India met its 2030 renewable energy target?
India has not yet met its 2030 NDC target of 500 GW of non-fossil capacity, but it has crossed the halfway mark at 262.7 GW. Notably, it achieved the 50% non-fossil milestone five years ahead of schedule, supported by utility-scale solar, wind, and distributed generation schemes.
Why is India's dependence on China a concern for its renewable energy transition?
In FY2025, India imported approximately 35 million solar modules valued at around $1.6 billion, with an estimated 60–80% sourced from China. While domestic module manufacturing has scaled, upstream segments like solar cells, wafers, and polysilicon still rely heavily on imported — primarily Chinese — components, leaving the supply chain exposed to geopolitical or trade disruptions.
How has India's domestic solar manufacturing grown?
According to MNRE data, India's domestic solar module capacity nearly doubled from 38 GW in March 2024 to 74 GW in March 2025, while cell capacity grew from 9 GW to 25 GW in the same period. Growth has been supported by PLI schemes and customs duties on imported modules.
What are upstream segments in solar manufacturing and why do they matter?
Upstream segments refer to the earlier stages of the solar manufacturing value chain — polysilicon, wafers, and solar cells — which are more technologically complex and capital-intensive than module assembly. India's gap in these segments means that even as deployment scales, a significant portion of the solar ecosystem remains dependent on external, particularly Chinese, supply chains.
