Executive summary

India has rapidly expanded its solar energy deployment over the past decade, emerging as one of the world’s largest and fastest-growing markets. However, this growth in deployment has not matched the growth of domestic manufacturing across the supply chain. Such a mismatch risks creating supply chain vulnerabilities in downstream segments, such as module manufacturing and deployment, due to continued import dependence (Premier Energies 2024; Vikram Solar 2024; Waaree Energies 2024a). As of March 2026, solar module manufacturing is the most established supply chain segment in the Indian solar PV industry, with a manufacturing capacity of 173 GW (MNRE 2026b). In comparison, nameplate solar cell manufacturing capacity is only ~30 GW, forming only 20 per cent of the module manufacturing capacity (authors’ analysis from Waaree Energies 2025; MNRE 2025a; Sinovoltaics 2025; ETEnergyWorld 2024; MNRE 2026a). For the remaining 80 per cent, module manufacturing would have to depend on imported cells primarily from China. Figure ES1 demonstrates the gap in growth between module and cell manufacturing.

Figure ES1. Module manufacturing capacity has outpaced cell manufacturing capacity by more than five times, creating high demand for new cell production

Scaling up solar cell manufacturing is thus necessary to solve this issue and improve supply chain resilience. Such scaling up is also critical for increasing domestic value addition through solar manufacturing, as nearly 60 per cent (InfoLink Consulting 2025c) of the solar module cost is attributable to the solar cells.

However, domestic solar cell manufacturers face a global landscape marked by declining prices and rapidly evolving technology—the global cell technology landscape has shifted, with PERC (passivated emitter rear contact) being replaced by TOPCon (tunnel oxide passivated contact) as the commercially dominant technology within two years (2023 to 2025). In 2 Image: CEEW contrast to this evolution, domestic solar cell manufacturing remains PERC-based, and faces higher manufacturing costs compared to Chinese counterparts. As a result, domestic solar cell manufacturing faces risks of technology lock-in and lack of cost competitiveness.

Hence, vertical integration into solar cell manufacturing must be accompanied by the development of technological capabilities and the reduction of manufacturing costs to build long-term competitiveness. The objective of this report is to identify the key priority areas and strategic interventions that should be targeted by policymakers and domestic solar manufacturers to achieve this twin goal.

This study adopts a techno-economic lens to arrive at the key findings, drawing from secondary literature and stakeholder consultations. Further, the interventions have been mapped by considering domestic policies, actions taken by other nations, and their relevance to the identified gaps.

Key findings

• Domestic solar cell manufacturing struggles with high capital expenditure and high consumable costs: Capital expenditure for domestic manufacturers is nearly 109 per cent (Premier Energies 2024; Waaree Energies 2024a; Vikram Solar 2024; APVI 2024) higher than that of Chinese counterparts. This is due to smaller production scales and limited access to subsidised infrastructure. Presently, the Production-Linked Incentive (PLI) scheme provides fiscal support to enlisted domestic cell manufacturers after manufacturing facilities are set up and sales are made. However, the high upfront capex has been a roadblock in the execution of this scheme. Further, key consumables—such as silver paste itself—contribute at least 20 per cent (APVI 2024) of the solar cell manufacturing cost, for TOPCon cell technologies. Chinese manufacturers benefit from subsidised, local silver paste supplies, whereas Indian manufacturers face higher costs due to import duties, contributing to the cost-ofmanufacturing disparity. Such high manufacturing costs, as showcased in Figure ES2, lead to limited expansion of cell manufacturing capacity.

Figure ES2. Higher costs in consumables and depreciation make cell manufacturing ~40% more expensive in India than China

• Import dependency for solar cell machinery creates technology lock-ins: Machinery for cell manufacturing is imported, and there is a lack of domestic equipment manufacturing. The technological knowhow for carrying out machinery setup and process optimisation rests with the equipment suppliers. As a result, domestic manufacturers depend on foreign equipment suppliers to provide this knowhow. Due to the lack of localised knowledge, manufacturers struggle to switch to high-efficiency cell technologies in a timely manner, as process optimisation for newer advanced lines takes longer than previous setups. Newer TOPCon production lines take nearly 12 months for process optimisation, when compared to PERC lines which take nearly 7–8 months. As a result, domestic cell manufacturing is still PERCcentric, whereas TOPCon accounts for 29 per cent of the domestic solar cell manufacturing capacity (Sinovoltaics 2025).
• Domestic manufacturers face a lack of skilled professionals and upskilling capability required for process optimisation of equipment: Solar cell manufacturing requires low-skilled operator roles for day-to-day operation of machinery, and high-skilled process engineers responsible for process control and optimisation of the overall production. The skills required by process engineers are highly equipment- and process-specific. These include troubleshooting process performance, evaluating process settings and stability of new cell production models, and deciding process conditions and material consumption specifications. Domestic manufacturers face both a lack of such skilled professionals and upskilling capabilities, leading to the industry remaining dependent on hiring foreign technical expertise. Only a few manufacturers have dedicated training centres; the rest depend on equipment providers training the engineers.
• Weak domestic R&D capacity threatens long-term competitiveness: Commercial solar cell technologies have rapidly evolved due to investment in research and development (R&D) globally, but similar domestic private investments in indigenous R&D, pilot-scale manufacturing, or process innovation have been largely absent. Domestic manufacturers spend a maximum of 0.1 per cent of their total revenue on R&D (Vikram Solar 2024), whereas Chinese manufacturers can spend from 2 per cent (Taiyang News 2025c) up to nearly 6 per cent of their total revenue on R&D (LONGi 2024). Similarly, public investment in solar PV R&D in India since 2014 has been approximately USD 13 million (MNRE 2024b), significantly lower than allocations in the US and Japan, along with weak industry participation in the government-allocated research grants for R&D. Further changes in the global cell technology landscape are expected through rise in market shares of presently commercialised technologies—heterojunction (HJT) and Back Contact (BC) cells—and commercialisation of alternate technologies such as tandem-perovskites. Lagging domestic R&D would lead to technology lock-ins, and inhibit solar cell manufacturers’ ability to adapt in a timely manner to such a changing technology market.

Key recommendations

1. MNRE could develop shared infrastructure for machinery localisation, cell technology development, and upfront capital-cost reduction: A national framework should be created to bridge the gap between laboratory research, pilot-scale validation, and commercial deployment. The key priorities are as follows.

• Support indigenisation of manufacturing equipment and critical inputs through a shared hub, anchored by centres of excellence (CoE), leading academic institutions, and experienced technology partners (acting as spokes). Such hubs should house capital-intensive infrastructure for advanced cell technologies, equipment development, and materials research. These include diffusion furnaces, chemical vapour deposition chambers, etc. The Ministry of New and Renewable Energy (MNRE) should collaborate with the Ministry of Heavy Industries (MHI) to design and implement this model. The MHI may also introduce a dedicated ‘capital goods for solar cell manufacturing programme’ under its National Capital Goods Policy.
• Establish pilot manufacturing to stay in line with market trends. The MNRE, in collaboration with the Ministry of Science and Technology (MST), academic institutions like IIT Bombay, IIT BHU and IIT Roorkee, and domestic solar cell manufacturers should collaborate to establish pilot-scale manufacturing facilities. By 2030, at least three pilot-scale cell manufacturing facilities covering TOPCon/XBC, HJT, and tandem-perovskite technologies should be operational. The objective should be to ensure that around 20 per cent of new cell capacity by 2030 is based on high-efficiency technologies beyond conventional TOPCon. Parallel efforts should promote pilot-scale development of critical inputs such as silver and hybrid metal pastes. The pilot-scale facilities would act as individual hubs, and research activities would be actioned by spokes such as the academic institutions and domestic solar cell manufacturers.
• Establish shared utility infrastructure that can be rented by multiple solar cell manufacturers, leading to a reduction in capital expenditure for solar cell manufacturing. This would help manufacturers scale-up fast and achieve cost-competitiveness. The MNRE can act as a nodal agency, bringing together manufacturers, utility companies, and statelevel stakeholders. State Industrial Development Corporations (SIDCs) can co-finance and build shared utilities such as chillers, compressors, diesel generators, gas cabinets, chemical delivery systems, etcetera. The shared utility facilities would act as individual hubs, with individual solar cell manufacturers acting like spokes and carrying out manufacturing.

2. MNRE could offer one-time capital subsidy to PLI winners to bridge capital expenditure gaps: Based upon our calculation, a one-time capital subsidy of 15 per cent would assist in bridging the capital expenditure gaps between Chinese manufacturers and domestic PLI winners. Execution of the PLI-allocated manufacturing capacity would double the solar cell manufacturing capacity, from nearly 30 GW to 60 GW.

Figure ES3. Framework for developing machinery, technology, materials, and reducing upfront manufacturing costs

3. MNRE could develop skilling programmes and training centres to upskill process engineers and build domestic technological capacity: Scaling solar cell manufacturing will require a substantial increase in skilled process engineers and technicians. Dedicated training centres should be established in key manufacturing states, supported by industry partnerships and specialised curricula targeting process optimisation, equipment handling, and advanced cell technologies. The MNRE, in collaboration with the All India Council for Technical Education (AICTE), can take charge of curriculum and courses development, while the Ministry of Education (MoE) and Ministry of Skill Development and Entrepreneurship (MSDE) can then serve as stakeholders responsible for implementing the courses through establishing the dedicated training centres.

4. Ministry of Commerce and Industry (MoCI) could push for strategic asset acquisition and technology transfer in trade policy: MoCI can negotiate easing of regulations for acquisition of distressed foreign manufacturing assets and intellectual property through trade and investment negotiations. This will push private players to acquire distressed companies. Such acquisitions can accelerate technology upgrading, reduce capital costs, and enable faster entry into advanced cell technologies without duplicating global R&D investments.

By shifting policy focus from module-led expansion towards technology-driven, vertically integrated solar cell manufacturing, India can stabilise its domestic manufacturing base, reduce strategic vulnerabilities, and position itself as a competitive player in a diversifying global solar value chain. Timely and coordinated action across policy, industry, and academia will be critical to ensuring that today’s manufacturing scale translates into durable industrial leadership over the next decade.