India’s Solar Panel Exports Decline as U.S. Trade Measures Limit Shipments

New Delhi – India’s solar module exports recorded a steep fall in September, reaching their lowest level of the year. Industry analysts attribute the decline to tightened U.S. trade actions that have significantly reduced outbound shipments.

Earlier in the year, Indian manufacturers saw strong demand from American developers. These buyers were seeking alternatives to Chinese panels due to restrictions placed on China-linked imports.

However, the landscape shifted when the United States implemented a 50% tariff on Indian solar goods. The move, along with enhanced scrutiny of supply chains, affected companies suspected of using Chinese-made components routed through India.

With the United States previously accounting for over 90% of India’s solar module exports, the impact has been substantial. Government data indicates that September exports dropped to around $80 million, down from $134 million in August.

Industry observers say the risk of U.S. investigations has already materialised for several manufacturers. These developments have pushed companies to redirect unsold volumes back into the domestic market.

India’s manufacturing capacity for solar modules currently stands near 110 gigawatts. Projections suggest this figure may rise to about 165 GW by March 2027 as expansion plans continue.

The slowdown in global purchasing, however, has raised concerns about excess supply at home. India’s annual solar installations remain below the 44–45 GW benchmark needed to stay on track for 2030 renewable-energy goals.

Analysts believe smaller, module-only companies may face deeper financial pressure. With shrinking margins, many of these firms could enter consolidation phases over the next few years.

In contrast, vertically integrated manufacturers — those producing cells, wafers, and ingots — are expected to endure the downturn more effectively. Their broader production capabilities offer more resilience in a tightening market.

In August, the All India Solar Industries Association issued a caution to the Indian Banks’ Association. It requested a halt on funding new projects deemed unviable to prevent future oversupply-driven bankruptcies.

Several companies are already adjusting business plans to align with evolving market realities. Some are shifting their focus from modules toward upstream components such as cells and wafers.

One example is Solex Energy, which recently revised its expansion blueprint. The firm scaled down its module manufacturing target from 15 GW to 10 GW and increased its planned cell production capacity from 5 GW to 10 GW.

Company executives say this shift was deliberate and aimed at avoiding future market saturation. They added that reducing module output helps mitigate the risk of price wars caused by surplus volumes.

India’s solar industry is now navigating a period of uncertainty shaped by changing international policies. The country’s manufacturers are balancing domestic opportunities with decreasing export prospects.

As global energy transitions accelerate, the sector is watching closely for new market openings. Whether export volumes rebound will depend on policy shifts, demand cycles, and competitive dynamics in major importing countries.

For now, industry players are recalibrating strategies to sustain growth in a fast-evolving renewable ecosystem. The next several months will be critical in determining the long-term direction of India’s solar manufacturing landscape.