China’s proposed solar technology export curbs may delay India’s domestic manufacturing push: Report
China's plan to impose export controls on photovoltaic technologies could create challenges for India's solar manufacturing sector and affect supply chains. These restrictions may lead to delays and increased costs for domestic players aiming for backward integration in manufacturing. The Approved List of Models and Manufacturers Phase II policy timelines could also be disrupted as a result.
A recent report by India Ratings and Research (Ind-Ra) warns that proposed export controls on 12 key solar photovoltaic manufacturing technologies from China could hamper India's efforts to boost domestic solar cell production. With over 75% of the global solar supply chain originating in China, the country has imposed plans to restrict the export of these technologies, citing their potential dual-use applications in defense and other sensitive sectors.
To do this, China would mandate the use of export licenses. This move could create execution risks for solar cell manufacturing, according to the rating agency.
Ind-Ra pointed out that similar licensing controls on high-end construction machinery can pose operational risks for engineering, procurement, and construction (EPC) companies. The agency emphasized the vulnerability of India to technology dependence, as the country is currently heavily reliant on China's supply chains. This new development could disrupt the timelines for the Approved List of Models and Manufacturers (ALMM) Phase II policy, potentially upsetting the supply-demand dynamics for Domestic Content Requirement (DCR) cells.
The ALMM-II framework requires solar project developers to source cells from domestic manufacturers.
The proposed curbs on solar technology exports could slow down capacity addition for backward integration, such as ingots and wafers production. This is especially true for companies that are still planning to enter the capex cycle. Bhanu Patni, Director at Ind-Ra, stated that domestic players expanding along the value chain have traditionally relied on government support, making continued policy backing crucial for maintaining capital expenditure and healthy margins for debt servicing.
Industry leaders have expressed their concerns as well. Volks Energie CEO Piyush Goyal suggested that the government should fund a mission for indigenous equipment, provide PLI support for technology ownership, seek partnerships with Japan, Korea, and Europe, and build a strong bench of cell-line engineers. Hanish Gupta, MD of Sunkind India, stated that the final impact of these export curbs will depend on regulations, licensing provisions, and the availability of alternative technology partners.
However, he stressed that diversifying supply chains and fostering domestic technology development are now essential for the solar sector.
Written by urgent.news from The Economic Times - Economy's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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