India’s Solar PV Module Exports Soared 23 Times Between FY 2022 and FY 2024

The nation can potentially replace Southeast Asia countries as a top solar PV product exporter to the US, according to a joint report by IEEFA and JMK Research.

India exported around $2 billion worth of PV modules in fiscal year (FY) 2024. The export value of PV modules from India increased by more than 23 times in just two years between FY2022 and FY2024, according to a joint report by IEEFA and JMK Research.

The report says USA is the top destination with 97% and 99% share of India’s PV exports in FY2023 and FY2024, respectively. India also exports PV products to South Africa, Somalia, Kenya, the UAE, Afghanistan, Nepal and Bangladesh.

As per the report, despite increased logistics expenses, domestic manufacturers can earn 40-60% higher profit margins on PV module sales in developed nations like the US than in India.

Other driving factors for surge in PV exports include reduced demand for domestic PV modules following the delayed implementation of the Approved List of Models and Manufacturers in April 2024, and several countries considering India as a viable option for their “China Plus One” strategy.

The US has imposed steep tariffs on PV products from China to gradually phase out Chinese imports. The US government might extend these tariffs to imports from Southeast Asia (SEA), subject to the result of an ongoing antidumping and countervailing duty (AD/CVD) investigation by the US Department of Commerce.

The report states that with the expiration of the Free Trade Agreement and an ongoing antidumping and countervailing duty investigation, India can potentially replace Southeast Asian countries to become the leading PV exporting country to the US.

The report recommends that as India establishes itself as a viable alternative to China, balancing the demands of the export and domestic markets is important.I t is crucial to ensure adequate domestic supply, especially for market segments with smaller order sizes, such as residential rooftop solar. The supply-demand gap also affects solar module prices, a critical factor for the price-sensitive residential rooftop solar segment

Leading exporters

In FY2024, India exported over 5.8 GW of PV modules, which was at least three times higher than in FY2023. The nation exported more than 29% of its PV module production in FY 2024, the majority of which was shipped by Waaree Energies, Adani Solar and Vikram Solar – each of which exported more than half of its annual actual production in FY2024. Other leading players like ReNew and Tata Power utilised a significant portion of their output for captive consumption in FY2024.

Several other Indian PV manufacturers like Grew Energy, ReNew Power, Navitas, Solex Energy and Saatvik Energy are pursuing export markets and setting up supply chains abroad. Waaree Energies and Vikram Solar are also planning to set up PV manufacturing capacities in the US, taking advantage of the incentives offered under the Inflation Reduction Act (IRA).