US Tariffs to Worsen India Solar Panel Glut as Domestic Bidding Slows
Elevated US tariffs and possible anti-dumping duties on solar panel exports from India will worsen a supply surplus in India next year as the pace of domestic project bidding declines, as noted by industry experts and analysts.
US President Donald Trump's 50 percent tariffs on imports from India will hinder panel sales to its primary international market, which represents 90 percent of module exports, they noted.
The circumstances may worsen if anti-dumping tariffs are placed on certain manufacturers after a petition submitted on July 17 by US solar firms to the Commerce Department requesting tariffs on imports from India, Indonesia, and Laos.
"The 50 percent tariff will tighten margins, and possible anti-dumping duties will complicate competition in the US further," stated Raj Prabhu, CEO of clean energy consultancy Mercom Capital.
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In the quarter ending June, India saw a significant slowdown in the awarding of solar generation projects and new tenders, with a federal power ministry advisor advising renewable developers to proceed carefully with bids according to demand growth forecasts.
"Wood Mackenzie analyst Yana Hryshko stated that we anticipate India will reach overcapacity by 2026, a situation made worse by the loss of the US market."
Incentives from New Delhi, such as import taxes and requirements for local manufacturing, contributed to a doubling of annual module production capacity to 74 gigawatts by March. State Bank of India Capital Markets forecasts this will hit 190 GW by 2027.
India's solar module factories are currently operating at an average of just 25 percent of their total capacity, according to Vinay Rustagi, chief business officer of Premier Energies.
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"Some firms operate at 80 percent-85 percent like we do, while others function at significantly lower levels," he stated.