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					</table>The demand for solar encapsulants is rising alongside the temporary surge in module demand, following the extension of the Approved List of Models and Manufacturers (ALMM-II) mandate for solar cells.
However, demand for backsheets remains largely flat as the market continues to shrink. Manufacturers say the demand is increasingly concentrated in glass-glass TOPCon DCR modules, leaving backsheets to compete in a contracting market while also facing import pressure.
Recovering Demand for Encapsulants
Developers are <a href="https://www.mercomindia.com/solar-module-price-set-to-rise-as-procurement-rush-builds-ahead-of-almm-ii-deadline" target="_blank" rel="noopener">accelerating</a> project commissioning ahead of the ALMM-II exemption deadline amid concerns over supply constraints.
Demand in June and July was weak as uncertainty around the mandate slowed module manufacturing and procurement, but it has since improved.
Avinash Hiranandani, Managing Director at <a href="https://www.renewsysworld.com/" target="_blank" rel="noopener">RenewSys India</a>, said that demand for encapsulants will naturally increase with a jump in module production. The company witnessed unusually strong demand last month amid developments surrounding the ALMM List-II mandates and expects capacity utilization to increase further this month.
Jignesh Gorechaa, Head of Sales and Branding at <a href="https://www.novanextenergies.com/" target="_blank" rel="noopener">Novanext Energies</a>, concurred. He said Novanext’s encapsulant production increased by 30 to 40% in the last quarter and is expected to rise by another 20% in the coming quarters.
However, Hiranandani added that India currently has sufficient encapsulant manufacturing capacity to meet the demand. RenewSys operated its machines at around 60%-70% utilization last month, leaving sufficient machinery, finished products, and raw materials available to meet the demand.
<a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/ALMM-encapsulant.png"><img loading="lazy" decoding="async" class="aligncenter wp-image-104343 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/ALMM-encapsulant.png" alt="" width="814" height="543" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/ALMM-encapsulant.png 814w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/ALMM-encapsulant-300x200.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/ALMM-encapsulant-768x512.png 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/ALMM-encapsulant-650x434.png 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/ALMM-encapsulant-624x416.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/ALMM-encapsulant-600x400.png 600w" sizes="auto, (max-width: 814px) 100vw, 814px" /></a>
Executives say module manufacturers may have large nameplate capacities but actual production is substantially lower.
According to another encapsulant manufacturer, around 45-50 GW of modules were manufactured in India last year. Therefore, existing domestic encapsulant capacity should be sufficient to meet current requirements.”
Module manufacturers also concur that they are not seeing any supply constraints for encapsulants.
Tanmoy Duari, CEO at <a href="https://axitecsolar.com/in" target="_blank" rel="noopener">Axitec Energy India</a>, said lead times for encapsulants did not increase during the peak of pre-deadline procurement activity. However, in the months leading up to June 2026, lead times extended due to bulk ordering by EPC companies and module manufacturers. The current supply chain pressure is temporary, with full normalization of the entire solar value chain expected over the next two to four quarters.
ALMM for Encapsulants
Manufacturers also said the government is considering bringing encapsulants under the ALMM framework to strengthen domestic manufacturing capacity.
While India’s encapsulant manufacturing sector remains dependent on imported raw materials, Gorechaa said rising freight costs and longer lead times for shipments from China are strengthening the case for a phased transition to domestic sourcing.
According to <a href="https://tradingeconomics.com/" target="_blank" rel="noopener">Trading Economics</a>, containerized freight rates stood at 3,509.54 points on August 28, 2026, up 142.86% year-over-year.
Gorechaa said lead times for encapsulant imports from China have increased from 25-30 days to 40-45 days. Chinese suppliers have also shifted toward advance payments instead of offering open lines of credit, increasing importers&#8217; working capital requirements.
Higher freight costs, longer delivery timelines, and tighter payment terms are therefore making domestic encapsulant sourcing increasingly attractive to solar manufacturers.
Backsheet Demand Flat
Unlike encapsulants, manufacturers in this segment said the demand remains largely flat as they face the dual challenge of dependence on imported raw materials and declining uptake, with module manufacturers increasingly shifting toward glass-glass configurations.
The demand is now primarily limited to mono PERC modules and certain TOPCon configurations.
RenewSys estimates that only around 2-3 GW of the approximately 40 GW of module production could use rear protective sheets.
A backsheet manufacturer estimated that roughly 80% of current market demand is for glass-glass modules, compared with 20% for glass-backsheet configurations.
However, newer materials are gaining prominence as alternatives to rear glass without significantly impacting generation.
Gorechaa said newer fluorocarbon-coated and low-water-vapor-transmission products are creating opportunities in TOPCon and heterojunction technology applications.
He added that transparent variants can replace rear glass in bifacial modules while reducing module weight.
Material requirements for backsheets are increasingly focused on UV stability, moisture resistance, and long-term durability, increasing the demand for more advanced products.
Import Dependence 
Encapsulant manufacturers remain heavily dependent on raw materials.
Critical inputs such as solar-grade ethylene vinyl acetate (EVA) and polyolefin elastomer (POE) resins used in encapsulants continue to be sourced from overseas markets.
Although several additives, including UV-protection and cross-linking additives, are available domestically, the principal EVA and POE resins are imported.
<a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/tableencapo.png"><img loading="lazy" decoding="async" class="aligncenter wp-image-104342 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/tableencapo.png" alt="" width="891" height="300" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/tableencapo.png 891w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/tableencapo-300x101.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/tableencapo-768x259.png 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/tableencapo-650x219.png 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/tableencapo-624x210.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/09/tableencapo-600x202.png 600w" sizes="auto, (max-width: 891px) 100vw, 891px" /></a>
An encapsulant manufacturer said EVA granules are predominantly sourced from South Korea, with China also supplying the Indian market. Hiranandani added that manufacturers also have sourcing options from the U.S. and Singapore.
Although EVA granules are currently available, import dependence exposes domestic manufacturers to global price volatility.
Prices rose from around $1,300 (₹124,317) to approximately $2,000 (₹191,256) between April and June before easing to about $1,450 (₹138,661)-$1,500 (₹143,442), according to an encapsulant manufacturer.
Manufacturers did not attribute the increase directly to geopolitical tensions in the Middle East but noted that petrochemical feedstocks used in EVA production are linked to the region.
Backsheet manufacturers are also largely dependent on imported critical raw materials. While PET is manufactured in India, the photovoltaic-grade PET required for solar applications is not currently produced domestically at the required quality.
Gorechaa added that China accounts for a major share of the industry&#8217;s solar-grade PET supply. PET can also be sourced from Indonesia and the United Arab Emirates, and PVDF is imported from China.
Backsheet manufacturers say that polyester films come from China, Thailand, and the Middle East, although adhesives are available domestically.
Cheaper Imports Add Pressure
Raw material imports also weaken the cost competitiveness of Indian manufacturers against lower-priced finished encapsulant imports, prompting the industry to seek trade protection.
An encapsulant manufacturer estimated Chinese EVA encapsulants are available at around ₹180 (~$1.88)/kg, compared with ₹210 (~$2.20)/kg to ₹230 (~$2.41)/kg for Indian products, making imports approximately 18% cheaper. RenewSys said competition comes from China, Southeast Asia, and South Korea.
According to RenewSys, the price gap between imported and domestic encapsulants is around 15%, with imported encapsulants priced at around ₹90 ($0.94)/sqm to ₹95 ($0.99)/sqm. In contrast, domestic encapsulants are sold at a lower margin at ₹105 ($1.10)/sqm.
Gorechaa said a domestically manufactured transparent backsheet could cost around ₹125 ($1.31) to ₹130 ($1.36) for a particular specification, compared with ₹105 ($1.10) to ₹110 ($1.15) for a Chinese product, representing a price difference of roughly 15%.
RenewSys estimated the price gap between imported and domestically manufactured backsheets at around 20%, with imported products costing approximately ₹100 ($1.05)/sqm and domestic products around ₹125 ($1.31)/sqm.
Seeing a material impact of imports on the domestic industry, the industry has requested the government to impose antidumping duties.
Last year, the Directorate General of Trade Remedies <a href="https://mercomindia.com/india-opens-antidumping-investigation-probe-into-solar-encapsulant-imports" target="_blank" rel="noopener">initiated</a> an investigation into alleged dumping of solar encapsulants exported from and originating in South Korea, Thailand, and Vietnam.
The industry is also seeking Bureau of Indian Standards norms and Quality Control Orders to restrict cheaper, potentially lower-quality products.
Need for Government Support
Industry executives say India’s localization push needs to extend beyond finished cells, modules, encapsulants, and backsheets to the raw materials used to manufacture them. For encapsulants, this would require domestic production of high-quality solar-grade EVA and POE resins. At the same time, photovoltaic-grade PET, PVDF, and other specialized polymers remain key gaps in the backsheet supply chain.
For India to deepen solar manufacturing beyond cells and modules, localization will ultimately need to extend to the specialty materials that support the entire solar supply chain.

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