India’s Solar Supply Chain: Strategic Dependence, Industrial Policy, and shades of Decoupling from China

Solar energy has become the world's fastest-growing source of new electricity generation with annual global installations rising from 51.8 GW to 507.2 GW between 2015-2024, and are projected to surpass 1 Terawatt by 2030.[1]. This growth remains heavily concentrated in China, which accounts for most of the global manufacturing capacity across the value chain[3]. India has been a substantial beneficiary of Chinese solar manufacturing, but since 2021 India has pursued a deliberate industrial policy to build domestic manufacturing capability, decouple from Chinese sourcing and reduce its import dependence. This brief examines two developments that predicate on guidance for such a strategy viz. the June 2026 enforcement of Approved List of Models and Manufacturers (ALMM) List-II, mandating domestically manufactured solar cells, and the imposition of US countervailing duties of up to 126 percent on Indian solar exports in 2026 [2,18]. Given India’s market potential and technological capacity, it pre-assesses two scenarios for how China may respond to India's push to localise production upstream of module assembly and argues that comparatively plausible scenario — strategic price competition in cells rather than outright disengagement that has a documented precedence in India's own recent experience with module- dumping of selling PVs below production cost.