By 2025, India is aiming to become the world’s second-largest producer of solar modules, surpassing Southeast Asia, with a focus on meeting the growing demand from the United States, according to a report by Wood Mackenzie. This development occurs as China is projected to maintain over 80% of the global capacity in the solar module supply chain by 2024.
The report highlights India’s ambition to boost module exports to the lucrative US market while facing challenges due to high production costs, attributed in part to a 25% basic customs duty on imported solar cells. There is speculation that the Indian government may consider reducing the duty on Chinese modules, which currently face a 40% tax, to support its export goals.
The United States, guided by the Inflation Reduction Act, is working to establish its photovoltaic manufacturing capabilities. However, the lack of domestic production of wafers, cells, or glass means the US will continue to rely on imports, particularly after President Biden’s temporary waiver on solar import tariffs expires in mid-2024.
As reported by ETEnergyworld.com, Southeast Asia’s solar capacity, largely fuelled by Chinese investments, and Europe’s demand for protective tariffs on Chinese modules due to perceived non-competitive prices indicate significant shifts in the global solar module supply chain.
The study also delves into China’s dominance in N-type cell technology, with China accounting for 95% of the announced global expansions in this sector. Despite challenges leading to tightened profit margins in the solar sector, the report suggests that vertically integrated manufacturers may still identify growth opportunities.
