India’s solar manufacturing sector is expanding rapidly as the government pushes for greater domestic value addition through frameworks like the Approved List of Models and Manufacturers (ALMM). While solar module manufacturing capacity has expanded rapidly, domestic solar cell production has lagged, creating supply constraints as the industry transitions to locally manufactured cells.

On the sidelines of the Mercom India Renewables Summit 2026, held in New Delhi on July 1 and 2, Mercom India spoke to Prashant Mathur, Chief Executive Officer of Saatvik Green Energy, about the domestic manufacturing ecosystem, ALMM implementation, technology transitions, infrastructure needs, and India’s long-term renewables manufacturing ambitions.

Edited excerpts from the interview:

India currently has nearly 200 GW of module manufacturing capacity but only about 30 GW of cell manufacturing capacity. How significant is this mismatch?

There is a clear mismatch. However, this is typical of any rapidly growing industry. Every major business group wants to participate in the renewable manufacturing sector, which naturally leads to periods of overcapacity followed by consolidation.

If you look at actual production, 200 GW of module manufacturing capacity does not mean 200 GW of annual output. At current utilization levels, effective production is roughly 70-80 GW. That represents only about 20%-30% overcapacity relative to market demand.

The larger issue is cell manufacturing. Of roughly 30 GW of domestic cell capacity, only 10-12 GW is based on TOPCon technology. The remaining capacity is mono PERC, which will gradually become obsolete as more advanced technologies become available.

There is tremendous scope to expand domestic cell manufacturing, and many companies, including ours, are entering this segment.

How will manufacturers bridge the transition from mono PERC to TOPCon technology?

Technology transitions are a regular part of manufacturing. I often compare it to smartphones. If you have the latest model available, customers naturally prefer it. But if supply is limited, they continue purchasing the previous generation.

The same applies to solar manufacturing. TOPCon offers higher efficiency, so demand is significantly higher. Since domestic availability remains limited, mono PERC continues to find buyers. As additional TOPCon manufacturing capacity comes online, mono PERC will gradually phase out.

What is your assessment of the government’s decision to implement ALMM List-II on schedule?

One of the biggest concerns the industry has had in the past was policy inconsistency. The government has now demonstrated that it is committed to following through on its announced timelines, and that is an extremely positive development.

ALMM for modules was originally expected several years ago but was implemented much later, which delayed the development of India’s manufacturing ecosystem.

Now that ALMM List-II has been implemented and ALMM List-III has already been announced for ingots and wafers, manufacturers have a clear roadmap. It sends a strong message that the government is serious about building a complete domestic manufacturing ecosystem.

Do you expect ALMM implementation to increase module prices?

Module prices are ultimately determined by demand and supply. The price increases seen over the past few months have largely been due to geopolitical developments and higher commodity prices rather than regulatory changes.

There may be a short-term price increase as domestic cell availability remains limited. However, once the announced manufacturing capacities come online, normal market dynamics should stabilize prices.

Do you believe India has excess module manufacturing capacity?

There is some overcapacity, but it is not as large as many people assume. At current utilization levels, effective module production is around 80 GW, while market demand last year was roughly 55-57 GW. That translates into approximately 20% overcapacity.

Going forward, module capacity will become less important than domestic cell availability because future projects will increasingly require Indian-made cells.

Manufacturers still have a transition window of roughly one to one-and-a-half years, during which they can continue supplying existing projects while integrating backward into cell manufacturing.

What additional policy support does the industry require?

Policy consistency remains the most important requirement because manufacturing projects involve substantial capital investment and long timelines.

In addition, India needs better industrial infrastructure if we want to compete globally.

Manufacturers require access to industrial land near ports, affordable electricity and water, common infrastructure, and lower financing costs. If these issues are addressed, India has every opportunity to emerge as a major global manufacturing hub.

How have recent global developments affected manufacturing?

Freight rates have doubled or even tripled over recent years. Oil prices, uncertainty around gas prices, and rising commodity costs have significantly increased manufacturing expenses.

At the same time, many countries are introducing incentives to promote domestic manufacturing. There is a broader shift in the global manufacturing landscape, which is accompanied by increasing geopolitical uncertainty.

Is skilled manpower still a challenge for advanced manufacturing?

Initially, yes. We have addressed this by building a workforce of experienced international professionals and Indian employees and ensuring continuous knowledge transfer.

Within the next year, we expect Indian professionals to operate these advanced manufacturing facilities independently.

Going forward, I believe the industry and government should jointly establish structured skill development programs.

Can India eventually match China in solar manufacturing?

Absolutely. The question is not whether India has the capability. We certainly do. The difference lies in the ecosystem. Chinese manufacturers benefit from easier access to land, roads, electricity, and water, as well as significantly lower financing costs.

We have a skilled workforce and the capability to compete. The cost difference primarily stems from differences in the overall manufacturing ecosystem.

Where do you see India’s solar manufacturing industry over the next five years?

We are only at the beginning of an explosive growth phase.

Within five years, I expect India to establish domestic polysilicon manufacturing. Once that happens, the country will have a complete solar manufacturing ecosystem, from polysilicon to cells and modules.

India will become self-sufficient and eventually emerge as a net exporter. Annual market demand currently stands at around 50-60 GW, but I believe it will eventually exceed 100 GW.

Demand will be driven by electric vehicles, electrification of cooking, artificial intelligence, data centers, and overall economic growth.

Recent geopolitical developments have also reminded the world that dependence on imported oil carries significant risks. India has more than 300 sunny days every year, making solar our most abundant and cost-effective energy resource.

We see very good days ahead—sunny days.