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India Ranks 3rd Globally in Renewable Energy Capacity, Upstream Push Needed

India has secured the third position globally in installed renewable energy capacity, according to a new Morgan Stanley report. The report emphasizes that the success of the renewable transition depends on localizing upstream segments like solar cells and wafers. While domestic module manufacturing has expanded rapidly, India still imports a significant portion of solar components, primarily from China. The country has achieved 50% non-fossil capacity five years ahead of its 2030 NDC target.

Key Points: India 3rd in Renewable Energy Capacity: Report

  • India ranks 3rd globally in installed renewable energy capacity
  • Domestic solar module capacity rose from 38 GW to 74 GW in one year
  • Upstream segments like solar cells and wafers still rely on imports, mainly from China
  • India achieved 50% non-fossil capacity five years ahead of its 2030 NDC target
2 min read

India ranks 3rd globally on installed renewable energy capacity, time to boost upstream segments

India ranks 3rd globally in installed renewable energy capacity. A new Morgan Stanley report highlights the need to boost upstream solar manufacturing segments.

"From a macro standpoint, the expansion of renewables directly compresses the import intensity of growth - Morgan Stanley Report"

New Delhi, May 10

India now ranks third globally on installed renewable energy capacity and the effectiveness of the renewable transition in improving macro resilience will depend on the success of industrial policy in localising upstream segments like solar cells over time, according to a new report.

Renewable energy is the central pillar of India's medium-term strategy to structurally reduce external energy dependence, according to a Morgan Stanley report.

Domestic module manufacturing capacity has expanded rapidly, supported by PLI schemes and customs duties. Recent data from MNRE suggests a sharp uptick in domestic solar manufacturing capacity, with module capacity rising from 38 GW in March 2024 to 74 GW in March 2025 and cell capacity from 9 GW to 25 GW in the same period.

"However, in upstream segments, such as solar cells, wafers and polysilicon, India's renewable deployment remains partly reliant on imported components. In FY2025, India imported approximately 35 million solar modules valued at around $1.6 billion, with an estimated 60-80 per cent of these imports sourced from China," said the report.

While renewable transition reduces fossil fuel dependence, it doesn't eliminate external exposure linked to manufacturing supply chains.

While deployment capacity has scaled quickly, upstream manufacturing capabilities have not kept pace. As a result, a meaningful portion of the solar ecosystem remains exposed to external supply chains, especially from China, said the report.

Non-fossil installed capacity has now crossed 50 per cent of total capacity, touching 262.7 GW in November 2025, with solar (132.9 GW) and wind (54GW) accounting for the bulk of incremental additions, according to a Morgan Stanley report.

The government's 2030 NDC target calls for 500 GW of non-fossil capacity, and India achieved 50 per cent non-fossil capacity five years earlier than anticipated, supported by a combination of utility-scale expansion, distributed generation schemes (such as PM Surya Ghar and PM-KUSUM) and continued policy support for grid integration.

"From a macro standpoint, the expansion of renewables directly compresses the import intensity of growth, as every incremental unit of domestic solar and wind reduces the economy's sensitivity to imported fossil fuels," said the report.

- IANS

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Reader Comments

S
Shreya B
Finally some positive climate news! But 60-80% imports from China? That's risky geopolitically. We should invest more in R&D for wafer and polysilicon tech. Otherwise we're just shifting our oil dependency to solar cell dependency.
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Michael C
I'm impressed India reached 50% non-fossil capacity five years early. The PM Surya Ghar scheme is really working in villages. But the report is right—without strengthening the solar cell and wafer segment, this progress could be fragile. Need more public-private partnerships.
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Ravi K
Honest opinion: The government gets credit for policies like KUSUM and PLI, but the lack of domestic cell manufacturing is a failure of planning. Why did we jump to module assembly without building the upstream chain first? Basic Industrial Policy 101. Need course correction now.
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Emma D
Encouraging data! As someone working in clean energy consulting, I've seen the solar module rush on the ground—but the cell import issue is real. For India to truly lead, it needs to break the China supply chain. Good news is 74 GW module capacity is already huge. Next step: 50 GW cell capacity. Let's go! 😎
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Nisha Z
This is good for our energy security, but I worry about the local environment. Solar farms need land, and wind farms affect birds. We need to balance renewable expansion with ecological sensitivity. Still, a step in the right direction for climate change. 🌍

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