India is Paving the Way for Solar Panel Production for Itself and the World.

China, a leader in clean energy innovation, is encountering competition right next door. One of its key clients is none other than India.

India, a significant purchaser of solar panels and electric vehicle batteries from China, is leveraging substantial government incentives to produce greener technology domestically. The country is motivated not only by the soaring energy needs of its 1.4 billion population but also by the desire to diversify away from US dependency, particularly toward nations aiming to resist China’s influence.

Despite its ambitions, India is still a relatively minor and latecomer to the scene. In the past year, India manufactured about 80 gigawatts of solar modules, while China produced over ten times that amount. The nation remains heavily reliant on coal, the most polluting fossil fuel, which constitutes its primary energy source, with plans to increase coal mining for further production.

Nevertheless, India is proactively looking to take advantage of the global shift towards renewable energy and the pushback against China’s dominance in new energy technologies.

The Indian government is providing attractive subsidies for domestic solar cells and battery manufacturing, imposing restrictions on foreign products linked to the largest renewable energy initiatives, all aimed at igniting a boom in clean energy production. For instance, by the end of the decade, companies will be required to manufacture panels locally in order to qualify for government contracts for rooftop solar installations covering 27 million households.

New Delhi has multiple objectives—social, economic, and geopolitical. With China as a formidable competitor, having previously clashed over border disputes, India’s drive to establish factories for solar energy, wind, and electric vehicles is partly motivated by the need for a secure energy supply chain. Simultaneously, India aims to generate well-paying manufacturing jobs.

However, India faces a common conundrum shared by many nations: whether to procure renewable energy technology inexpensively from China or to invest more in domestic production.

“From a strategic standpoint, manufacturing capabilities are essential to ensure energy independence,” remarked Sudeep Jain, additional secretary of India’s Ministry of New and Renewable Energy. “Currently, cost is a major factor.”