The difficult reality of cutting China out of supply chains
“There’s nowhere else for us to go,” a leading Indian CEO warns. “They’ve wised up to this fact.”
China plays a critical role in global manufacturing, but foreign nations are imposing restrictions due to concerns about domestic industries being undermined by cheap, high-quality Chinese goods. India, for instance, is mandating that solar power supply chains become more locally sourced ahead of its ambitious goal of adding 200 gigawatts of non-fossil fuel capacity by 2030.
China has responded to these pressures by implementing export controls on solar equipment technologies and restricting access for Indian firms to key components in the supply chain. ReNew, an Indian renewable energy firm, admitted that dependence on Chinese equipment is unavoidable for now, as they currently import the necessary components for production.
While this reliance on China increases costs, the firm believes that local manufacturing will eventually reduce these expenses. However, the real challenge lies in diversifying supply chains to avoid the vulnerabilities associated with concentration in a single country. Currently, a significant portion of clean tech equipment, including modules, cells, and wafers, is still imported from China, leaving India vulnerable to potential supply disruptions.
Written by urgent.news from Semafor's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
