India’s energy journey has evolved rapidly over the past decade, as the country gradually moves from a traditional fuel-based system towards a cleaner and more sustainable energy model. Rising industrialisation, urbanisation, and the expansion of the digital economy have consistently increased energy demand. To meet this demand, India has made significant investments in renewable energy, especially in the solar and wind sectors, while also expanding capacity at scale.
Over the last 10 years, a clear shift has been seen in India’s energy policy, with a stronger focus on goals such as energy security, reducing import dependency, and achieving low-carbon growth.
Let us understand India’s solar manufacturing and renewable energy boom in detail and explore whether this theme can emerge as a major investment opportunity for investors.
What’s Happening?
India’s solar module manufacturing capacity has increased from 3 GW to 172 GW over the past decade, reflecting a major shift in the country’s clean energy transition. Currently, India’s domestic solar cell manufacturing capacity stands at 27 GW, which is an important step towards developing the entire value chain.
Solar power in India is not limited to large solar parks; rooftop installations have also grown rapidly. Under the PM Surya Ghar Muft Bijli Yojana, around 10,000 rooftop solar units are being installed every day, and so far, 40 lakh rooftop installations have been completed.
The installed capacity of solar power in the country has reached around 144 GW, indicating that manufacturing capacity is not just on paper but is also contributing to actual electricity generation.
India’s Energy Demand and Renewable Shift
Alongside India’s growing economy, energy demand continues to rise. In FY 2023-24, India’s Total Primary Energy Supply (TPES) reached 9,03,158 KToE, of which coal accounted for 60.21%, crude oil for 29.83%, and natural gas for 6.99%.
The contribution of renewable energy is also steadily increasing. From 17,682 KToE in FY 2014-15, renewable energy supply rose to 31,847 KToe in FY 2023-24, reflecting strong growth over the last decade.
India’s total renewable energy potential, as of March 2024, has been estimated at 21,09,655 MW, of which wind energy accounts for 11,63,856 MW (55%) and solar energy for 7,48,990 MW (around 36%).
Policy Support and Manufacturing Ecosystem
Through policies such as the Approved List of Models and Manufacturers (ALMM), the government is promoting domestic manufacturing. As of March 2026, a total solar module manufacturing capacity of 1,72,592 MW has been recorded across 17 states.
At the state level, Gujarat (80,060 MW), Rajasthan (21,779 MW), Tamil Nadu (15,199 MW), Maharashtra (11,414 MW), and Haryana (9,749 MW) have emerged as major manufacturing hubs.
The government’s focus is not limited to module manufacturing but also extends to promoting domestic production of key components such as solar cells, wafers, and ingots, which can help reduce import dependency.
What Does This Mean for Investors?
India’s rapidly growing electricity demand and increasing focus on renewable energy could make the solar sector a long-term growth theme. In FY 2023-24, Total Final Consumption (TFC) reached 6,13,605 KToE, which is 38% higher compared to FY2014-15.
Rapid growth in rooftop solar installations, expanding domestic manufacturing, and continued policy support suggest that opportunities may increase in the coming years for EPC companies, module manufacturers, and power generation companies.
The expansion of the solar manufacturing value chain can support employment generation, capital expenditure growth, and technological innovation, contributing to long-term industrial development.
What’s Next?
India aims to expand clean energy capacity to ensure long-term energy security. The growth in solar manufacturing from 3 GW to 172 GW indicates that the country is steadily moving towards a self-reliant energy ecosystem.
The government plans to mandate the use of domestically manufactured cells in all solar projects from June 2026 and aims to develop 42 GW of domestic solar cell manufacturing capacity by 2026. This move can further strengthen domestic manufacturing and support the entire value chain.
Overall, India’s solar manufacturing sector is not just a story of energy transition, it is also becoming an important pillar of the country’s industrial and economic growth.
Disclaimer: This article is for educational and informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. The companies mentioned are cited as examples within the context of market developments. Investors are advised to conduct their own due diligence and consult their financial advisor before making any investment decisions.
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