Recent research conducted by energy analyst JMK Research suggests that India's solar module exports to the United States and Europe are expected to reach their zenith in 2025, with a subsequent decline anticipated starting in 2026. This projection is attributed to the establishment of domestic manufacturing facilities in these regions.
JMK Research's report, titled “New Paradigms of Global Solar Supply Chain,” underscores the pivotal role played by the US and Europe in stimulating the growth of domestic photovoltaic (PV) manufacturing in India. The United States has been the primary export destination for Indian PV products.
In 2023, India is poised to export nearly $1 billion worth of PV modules to the United States, constituting around 97% of India's total global module exports. Notably, Indian PV module exports to the US have seen an exponential increase, growing 16-fold in 2023 compared to the previous year. This surge is attributed to ongoing investigations into module imports from Southeast Asian nations in the US. However, in May, President Joe Biden vetoed the proposal to revoke his two-year waiver on Southeast Asian solar PV imports, demonstrating continued interest in Indian solar products.
In response to alleged forced labor concerns in the production of goods, including solar module components, in Xinjiang, China, the US introduced the Uyghur Forced Labor Prevention Act (UFLPA). The UFLPA, along with the European Union, is preparing to ban products linked to forced labor in their supply chains. This action is expected to further boost exports from India to the US and European markets, according to JMK Research.
Nevertheless, JMK Research predicts a decline in India's PV module exports to the US and Europe starting in 2026, as new domestic manufacturing facilities become operational in these regions.
With this anticipated decrease in exports to the US, JMK Research suggests that Indian solar manufacturing companies should explore alternative markets, including those in Africa and South America. Some countries may seek alternatives to Chinese imports, which could present opportunities for Indian solar module manufacturers.
JMK Research notes that the “China+1” sentiment among nations in securing their supply chains is likely to drive a growing preference for India-based PV products in the global market. The possibility of the US entering into a “friend-shoring” agreement with India under the Quadrilateral Security Dialogue (QUAD), where the US continues to import a fixed quantity of PV products from India, is also considered.
Additionally, the global shift towards hydrogen-based energy sources presents an opportunity for India's solar module manufacturers. The United States has committed to transitioning one-third of its total hydrogen production to renewable sources by 2030, potentially opening up a significant growth avenue for Indian PV exporters, as per JMK Research.
India is anticipated to reach module production levels of over 20 gigawatts (GW) next year, surpassing the estimated domestic demand of 10 GW. The gap between estimated domestic demand and module production is expected to widen, with module production projected to reach approximately 60 GW by 2030, while domestic demand is forecasted to increase to just over 20 GW.
