Council on Energy, Environment and Water Integrated | International | Independent
Suggested Citation: Biswas, Spandan and Aarathi Srinivasan. 2026. Advancing Solar Cell Manufacturing in India: Bridging Gaps in Cell Technology and Lowering Manufacturing Costs. New Delhi: Council on Energy, Environment and Water.
India’s solar module manufacturing capacity has expanded rapidly. However, domestic solar cell manufacturing capacities continue to lag behind, creating import dependence and supply chain vulnerabilities. To scale up, domestic manufacturers have to contend with high manufacturing costs while adapting to a rapidly changing technology landscape. Currently, higher costs for capital and consumables drive up Indian solar cell production costs in comparison to global counterparts, while structural challenges like import dependence, skill gaps, and lagging R&D lead to difficulties in developing indigenous capability.
This study proposes targeted actions for policymakers, solar cell manufacturers, equipment suppliers, and academia to make Indian solar cell manufacturing competitive on both cost and technology.
India has rapidly expanded its solar energy deployment over the past decade, emerging as one of the world’s largest and fastest-growing markets. However, this growth in deployment has not matched the growth of domestic manufacturing across the supply chain. Such a mismatch risks creating supply chain vulnerabilities in downstream segments, such as module manufacturing and deployment, due to continued import dependence (Premier Energies 2024; Vikram Solar 2024; Waaree Energies 2024a). As of March 2026, solar module manufacturing is the most established supply chain segment in the Indian solar PV industry, with a manufacturing capacity of 173 GW (MNRE 2026b). In comparison, nameplate solar cell manufacturing capacity is only ~30 GW, forming only 20 per cent of the module manufacturing capacity (authors’ analysis from Waaree Energies 2025; MNRE 2025a; Sinovoltaics 2025; ETEnergyWorld 2024; MNRE 2026a). For the remaining 80 per cent, module manufacturing would have to depend on imported cells primarily from China. Figure ES1 demonstrates the gap in growth between module and cell manufacturing.
Figure ES1. Module manufacturing capacity has outpaced cell manufacturing capacity by more than five times, creating high demand for new cell production
Scaling up solar cell manufacturing is thus necessary to solve this issue and improve supply chain resilience. Such scaling up is also critical for increasing domestic value addition through solar manufacturing, as nearly 60 per cent (InfoLink Consulting 2025c) of the solar module cost is attributable to the solar cells.
However, domestic solar cell manufacturers face a global landscape marked by declining prices and rapidly evolving technology—the global cell technology landscape has shifted, with PERC (passivated emitter rear contact) being replaced by TOPCon (tunnel oxide passivated contact) as the commercially dominant technology within two years (2023 to 2025). In 2 Image: CEEW contrast to this evolution, domestic solar cell manufacturing remains PERC-based, and faces higher manufacturing costs compared to Chinese counterparts. As a result, domestic solar cell manufacturing faces risks of technology lock-in and lack of cost competitiveness.
Hence, vertical integration into solar cell manufacturing must be accompanied by the development of technological capabilities and the reduction of manufacturing costs to build long-term competitiveness. The objective of this report is to identify the key priority areas and strategic interventions that should be targeted by policymakers and domestic solar manufacturers to achieve this twin goal.
This study adopts a techno-economic lens to arrive at the key findings, drawing from secondary literature and stakeholder consultations. Further, the interventions have been mapped by considering domestic policies, actions taken by other nations, and their relevance to the identified gaps.
Figure ES2. Higher costs in consumables and depreciation make cell manufacturing ~40% more expensive in India than China
1. MNRE could develop shared infrastructure for machinery localisation, cell technology development, and upfront capital-cost reduction: A national framework should be created to bridge the gap between laboratory research, pilot-scale validation, and commercial deployment. The key priorities are as follows.
2. MNRE could offer one-time capital subsidy to PLI winners to bridge capital expenditure gaps: Based upon our calculation, a one-time capital subsidy of 15 per cent would assist in bridging the capital expenditure gaps between Chinese manufacturers and domestic PLI winners. Execution of the PLI-allocated manufacturing capacity would double the solar cell manufacturing capacity, from nearly 30 GW to 60 GW.
Figure ES3. Framework for developing machinery, technology, materials, and reducing upfront manufacturing costs
3. MNRE could develop skilling programmes and training centres to upskill process engineers and build domestic technological capacity: Scaling solar cell manufacturing will require a substantial increase in skilled process engineers and technicians. Dedicated training centres should be established in key manufacturing states, supported by industry partnerships and specialised curricula targeting process optimisation, equipment handling, and advanced cell technologies. The MNRE, in collaboration with the All India Council for Technical Education (AICTE), can take charge of curriculum and courses development, while the Ministry of Education (MoE) and Ministry of Skill Development and Entrepreneurship (MSDE) can then serve as stakeholders responsible for implementing the courses through establishing the dedicated training centres.
4. Ministry of Commerce and Industry (MoCI) could push for strategic asset acquisition and technology transfer in trade policy: MoCI can negotiate easing of regulations for acquisition of distressed foreign manufacturing assets and intellectual property through trade and investment negotiations. This will push private players to acquire distressed companies. Such acquisitions can accelerate technology upgrading, reduce capital costs, and enable faster entry into advanced cell technologies without duplicating global R&D investments.
By shifting policy focus from module-led expansion towards technology-driven, vertically integrated solar cell manufacturing, India can stabilise its domestic manufacturing base, reduce strategic vulnerabilities, and position itself as a competitive player in a diversifying global solar value chain. Timely and coordinated action across policy, industry, and academia will be critical to ensuring that today’s manufacturing scale translates into durable industrial leadership over the next decade.
The global transition to renewable energy has positioned solar photovoltaic (PV) technology as a cornerstone in addressing the trilemma of balancing energy security, affordability, and environmental sustainability. Unlike fossil fuels, disruptions in the supply of renewable energy technologies such as solar PV do not immediately affect a country’s energy system, contributing to energy security (IEA 2024). The levelised cost of electricity (LCOE) of solar PV was around USD 61 per megawatt-hour (MWh) in 2024, much lower than LCOE from fossil fuel sources like coal, which is around USD 118 per MWh in 2024 (Lazard 2024), showcasing its affordability. Along with this, solar PV systems do not directly emit greenhouse gases during energy generation, making them an ideal alternative to fossil fuels for reducing carbon emissions.
Solar PV installations have surged worldwide, with annual solar PV installations rising from 51.8 gigawatts (GW) in 2015 to an estimated 507.2 GW in 2024 (IEA 2025b). This has been driven by rising solar PV module manufacturing capacity, which has grown from nearly 120 GW in 2015 to 1,379 GW in 2024 (IEA 2025b), as shown in Figure 1. While manufacturing capacity has grown to support higher deployment, annual solar PV deployment remains less than half of total capacity across the solar supply chain. This imbalance has led to oversupply, driving down average market prices for each component, as shown in Figure 2.
Manufacturing growth is largely driven by Chinese producers who, by capitalising on government incentives, have achieved economies of scale, resulting in the solar PV supply chain becoming heavily concentrated in China. Out of the total global manufacturing capacity, 92 per cent of polysilicon production, 98 per cent of ingot and wafer production, 91.8 per cent of solar cell manufacturing capacity, and 84.6 per cent of solar module assembling capacity are located in China (SolarPower Europe 2025). Despite the manufacturing overcapacity in China, the declining prices have also affected profitability of Chinese manufacturers such as Jinko Solar, LONGi, JA Solar, and Trina Solar, who are locked in fierce competition to retain market share amidst the issue of manufacturing overcapacity. The fall in polysilicon prices, while reducing the cost of production, has undervalued the inventories of Chinese manufacturers. This has led to heavy investment in technological innovations to outperform peers in terms of efficiency and manufacturing costs. The development of such technological innovations has been captured in the next subsection.
1.1 A dynamic market: Solar cell efficiencies rise due to ever-evolving technology market
Solar PV technology can be categorised as either silicon-based or thin-film-based. Globally, silicon-based solar PV is the dominant technology, with a market share of nearly 97.5 per cent, while thin-film technologies make up the rest (Fraunhofer ISE 2024). The supply chain for silicon-based solar PV modules consists of producing polysilicon from metallurgical grade silicon, melting polysilicon to make ingots, slicing them into wafers, utilising the wafers to make solar cells, and assembling the solar cells into modules using bill-of-material (BOM) components such as solar glass, encapsulant materials such as ethylene vinyl acetate sheet (EVA) and polyolefin elastomer (POE), backsheets and junction boxes. Due to its prevalence, this report exclusively focuses on silicon-based PV technology.
Solar cell technologies are constantly evolving in terms of efficiency, costs, and market share. Among silicon-based cells, the different cell technologies that have been commercialised are passivated emitter rear contact (PERC), tunnel oxide passivated contact (TOPCon), heterojunction (HJT), and different variants of Back Contact (BC) on either TOPCon or HJT, termed as XBC. There have been changes in wafer technology too, with the industry shifting from multi-crystalline wafers to monocrystalline wafers. The commercialisation and gradual development of these different cell technologies have been reflected in increasing photovoltaic conversion efficiencies. The photovoltaic conversion efficiency refers to the percentage of incident solar energy a solar cell or module can convert into electrical energy, and it has risen from a meagre 14 per cent in 1977 to nearly 27.8 per cent in 2025 (Green et al. 2025). The improvements in photovoltaic conversion efficiency offered by advanced solar cell designs contribute to a lower LCOE (Wang et al. 2011) which acts as an incentive for the industry to focus on manufacturing and adopting these solar cell technologies.
Rapid R&D and commercialisation have led to solar cell efficiencies rising from 21.7% in January 2023, to 24.5% in June 2025, across different evolving technologies globally.
Global manufacturers are pushing for continuous technological innovation to push efficiencies up for solar cell technologies, and this is captured in Figure 3.
PERC, which dominated the global market till 2023, appears to be the most stagnant technology in terms of efficiency improvement. Since 2023, TOPCon has taken over as the leading commercially available technology, with an estimated market share of nearly 60 per cent (VDMA 2025). This has been due to both the higher efficiencies promised by it, and its similar manufacturing cost to PERC. This evolution in market share is captured in Figure 4. While HJT and XBC exhibit higher cell efficiencies than TOPCon, they have low market shares due to their higher manufacturing costs. However, they are predicted to grow in the future, making up nearly 50 per cent of the global market post 2030 (VDMA 2025).
The eventual rise of HJT and XBC cell technologies is predicated on their achieving cost competitiveness with TOPCon. Beyond the current commercially available technologies, alternative technologies such as tandem perovskites are also predicted to enter the global market post 2030. Tandem perovskites have the potential for solar cell efficiencies higher than conventional silicon-based solar cells (PV Magazine 2024), and are yet to reach maturity.
The change in market share for each technology thus depends on their efficiencies, their scale of maturity, and how complex the manufacturing process is. The transition from PERC to TOPCon was facilitated by the similarities in their manufacturing processes, and similar capital expenditure—the average capital expenditure for PERC and TOPCon are USD 34.5 million per GW (CRISIL 2024) and USD 33.5 million per GW (CRISIL 2024; APVI 2024), respectively. In contrast, while HJT has fewer process steps, it has a much higher average capital expenditure, at USD 72 million per GW (CRISIL 2024).
Compared with silicon-based solar cells, the futuristic tandem perovskite cells are estimated to have lower production costs. The capital expenditure for setting up a perovskite manufacturing plant is estimated to be one-fifth of the capital expenditure required for a silicon solar manufacturing plant (Rethink Energy 2024a). Further, perovskite manufacturing processes operate at much lower temperatures than conventional silicon solar manufacturing, meaning lower energy consumption and operating costs (Mitsui & Co Global Strategic Studies Institute 2024). Lower energy consumption also entails a lower emissions profile associated with perovskite manufacturing. Further technical details and description of all the solar cell technologies mentioned (PERC, TOPCon, HJT, Back Contact, and perovskite) are provided in Annexure 3.
The historical and predicted changes in market share reveal the dynamic nature of solar cell technology, with Chinese manufacturers focusing on technological breakthroughs to increase conversion efficiency, while optimising for cost. Indian manufacturers thus must now contend with this dynamic technology landscape while competing with historically low market prices. The next subsection will detail how the domestic solar PV sector has evolved in terms of deployment, manufacturing, and technology.
1.2 How has India fared within this sector?
The Government of India has set a Nationally Determined Contribution (NDC) target of achieving 500 GW of cumulative electric power generation from non-fossil fuel sources by 2030, and solar photovoltaic sources are expected to contribute 292 GW (over 50 per cent) to this target (CEA 2023).
Supply-side policies such as Production-Linked Incentive (PLI) scheme have incentivised domestic manufacturers to carry out vertical integration across the solar PV supply chain. Demand-side policies include domestic content requirement (DCR) schemes such as Pradhan Mantri Kisan Urja Suraksha evam Uthaan Mahabhiyan (PM-KUSUM) and Pradhan Mantri-Surya Ghar Muft Bijli Yojana, which require domestic solar cells and modules to be used for rooftop solar PV installations and distributed renewable energy installations.
Additionally, similar to the Approved List of Models and Manufacturers (ALMM) List I, which acts as a non-tariff barrier for domestic modules against imports, the government plans to implement the ALMM List-II from June 2026 to create demand for domestic cells (MNRE 2024a).
As of February 2026, India’s installed solar capacity stands at 140.60 GW (MNRE 2025c), and the annual solar PV installation in FY 2025 was 23.83 GW, as given in Figure 5. Thus, around 151.4 GW needs to be installed over the next four years to meet the NDC target, which entails an annual average deployment of nearly 37.85 GW.
While deployment rates are short of the required installations, module manufacturing capacity enlisted in ALMM List-I reached 173 GW in March 2026 (MNRE 2026b). However, 80 per cent of this would be dependent on imported solar cells from China as the domestic solar cell manufacturing capacity stands at 29.66 GW (Waaree Energies 2025; MNRE 2025a; Sinovoltaics 2025; ETEnergyWorld 2024; MNRE 2026a), as shown in Figure 6. This gap in the domestic module and cell manufacturing capacity needs to be bridged in a timely fashion to reduce industry’s exposure to supply chain vulnerabilities, as well as ensure compliance with upcoming policy mandates like the ALMM List-II.
Domestic cell manufacturing is mainly PERC-based, with a few manufacturers producing TOPCon. Previously dominant BSF (back surface field) solar cell technology, has very minor production share now. A breakdown of the manufacturing capacities for different cell technologies has been provided in Figure 7.
Out of 29.66 GW of solar cell manufacturing capacity, BSF accounts for 0.43 GW, PERC for 14.76 GW, TOPCon for 8.5 GW, HJT for 1.72 GW, thin-film (cadmium telluride) for 3.3 GW, while around 0.9 GW is unknown—not clarified by solar cell manufacturers. A detailed manufacturer-wise breakdown is provided in Annexure 1. Recognising the global trend of the rising importance of TOPCon, several Indian manufacturers have announced expansion plans to set up TOPCon-based manufacturing facilities—amounting to nearly 22 GW—by March 2027. A detailed manufacturerwise breakdown of such expansion plans has been provided in Annexure 2.
The government has also imposed a Basic Custom Duty of 20 per cent and Agriculture Infrastructure Development Cess (AIDC) of 7.5 per cent on imported solar cells, to protect domestic cell manufacturing (Ministry of Finance 2025). Further, on 29 September 2025, the Directorate General of Trade Remedies (DGTR) recommended antidumping duties up to 30 per cent on imported Chinese solar cells (DGTR 2025). If the ADD is levied, the cumulative tariff of 57.5 per cent would lead to an increase in the price of imported cells from USD 0.039 per Wp (InfoLink Consulting 2025b) to nearly USD 0.06 per Wp, which is near the lower end of the domestic solar cell price (nearly USD 0.07 per Wp), as of November 2025 (CRISIL 2025). While the duties make imported Chinese solar cells comparable to domestic solar cells in terms of price, domestic solar cell manufacturing remains more expensive than Chinese cells, and the removal of duties would ultimately lead to non-competitiveness. Therefore, domestic solar cell manufacturing currently faces a twin-problem of higher manufacturing costs and a lag in adoption of current mainstay solar cell technology.
57.5% import tariffs on imported solar cells have narrowed the gap with domestic market prices – yet, higher production costs and technology adoption lag constrain capacity expansion and competitiveness.
1.3 Twin problem of high manufacturing costs and technology lag
To reap the benefits of indigenisation, the twin problems of higher manufacturing costs and technological lag must be addressed, and for that, their causes must be identified. The research objective of this report is to identify what causes these two problems and identify strategic interventions that policymakers and domestic manufacturers can carry out that would solve them. Due to the dominance of silicon-based solar cell technology (97.5 per cent of the total market share worldwide), the report focuses on costs, components, technology, and machinery aspects of silicon-based solar cell manufacturing only.
Overcoming these challenges will help the domestic manufacturing industry achieve indigenisation of solar cell manufacturing, leading to supply chain resilience. Furthermore, this would enable Indian manufacturers to capitalise on the prevailing ‘China Plus One’ sentiment in international markets, and become a significant player in diversifying global solar supply chains. This would help domestic manufacturers to expand their export markets. Historically, more than 97 per cent of India’s solar exports across FY 2023, FY 2024, and FY 2025, have been geared towards the United States (Sharma, Gulia and Garg 2024). However, due to 18 per cent tariffs being levied on Indian exports to the USA (Ministry of Commerce 2026), along with ongoing anti-dumping duties (ADD) and countervailing duties on Indian solar cells and modules by the US Department of Commerce and US International Trade Commission (USITC) (USITC 2025), this export market has now come under threat. Vertical integration, starting with the production of solar cells, would also aid in the creation of new jobs, stimulate investment, and create market opportunities.
We carried out a comprehensive literature review to identify the current solar cell technology landscape. This included identifying the cost-drivers of solar cell manufacturing in Chapter 2, and identifying key technological issues for domestic solar cell manufacturers in Chapter 3. We further complemented findings from the literature review with stakeholder consultations, and identified the specific factors contributing to high domestic manufacturing costs and persistent technological lag. Finally, we have provided key recommendations that will help policymakers and stakeholders navigate these challenges to establish a resilient and future-proof solar cell manufacturing industry. We drew up these recommendations by considering existing domestic policies, comparing what policy measures other nations have taken, and the key gaps identified from the analysis.
Prices for components across the solar supply chain have hit historic lows, as detailed in Figure 2. Market prices of Chinese solar cells were around USD 0.038 per Wp (Infolink Consulting 2025c) in November 2025, much cheaper than domestically manufactured solar cells, which can have market prices as high as USD 0.07 per Wp. Even after the implementation of a total of 57.5 per cent of duty (BCD and ADD) on imported solar cells, the price of imported solar cells is in the range of 0.06 USD per Wp, which is still cheaper than the price range of domestic solar cells. The market price of solar cells is determined by both supply and demand, and the production cost of solar cells. As 91.8 per cent of global solar cell manufacturing capacity is concentrated in China, the supply side price dynamics are influenced by Chinese manufacturers.
However, this pricing regime is beginning to shift. China’s decision to phase out value-added-tax (VAT) export rebates for solar wafers, cells, and modules from 1 April 2026, after an earlier cut in late 2024, has already raised export and domestic pricing along the entire supply chain, and is shifting sourcing and trade patterns worldwide. China previously reduced the export tax rebate for PV products to 9 per cent from 13 per cent in December 2024, as part of its broader efforts to curb overcapacity and deflationary price wars amid international trade tensions (PV Magazine 2025a; Reuters 2026). Spot-price data now reflects this, with rise in mono-PERC cell prices to averages near USD 0.047 to 0.056 per Wp (InfoLink Consulting 2025c). It is expected that cell prices will increase along with modules once rebates are removed. Project equipment and panel procurement costs are also expected to increase by 9 to 15 per cent (MERCOM India 2025a) in the short term.
While these developments may narrow the price differential at the margin, the structural gap between Chinese and Indian manufacturing costs remains substantial. For Indian manufacturers to compete sustainably, irrespective of short-term price corrections driven by Chinese policy, it is essential to reduce domestic production costs. This makes it imperative to systematically analyse and elucidate the differences in the cost structures of solar cell manufacturing in India and China. The subsequent sections, therefore, break down the key drivers of production cost in both geographies.
2.1 Breaking down cost drivers of Chinese and Indian solar cell manufacturing
The first difference between domestic and Chinese manufacturing set-up is the level of vertical integration. Leading Chinese manufacturers are vertically integrated across wafer, cell, and module production (InfoLink Consulting 2023), while Indian solar cell manufacturers have to depend on imported wafers. As Chinese manufacturers are vertically integrated, their cost of manufacturing solar cells does not include the cost of wafer sourcing.
The cost of manufacturing solar cells includes costs due to capital expenditure (which, when accounted for across the lifetime of a manufacturing facility, are termed as depreciation), consumables (such as wafer, silver paste, and other chemicals), labour, electricity, overheads, and other costs, such as maintenance of the manufacturing facility, overheads such as R&D, and costs due to shipping and tariffs (APVI 2024). Figure 8 provides a comparison of cost-of-manufacturing TOPCon solar cells in Chinese and Indian manufacturing set-ups. Given that TOPCon is the currently dominant solar cell technology and is expected to have a market share of at least 50 per cent till 2030, cost of manufacturing estimations for Chinese and Indian set-ups are based on TOPCon solar cell technology (VDMA 2025).
Consumables for the Indian estimate include both wafer and silver paste, while consumables for the China estimate include only silver paste. Other consumables, such as the chemicals in which wafers are dipped, form a very miniscule portion of the total costs, and hence are not included in the calculation. Further, depreciation for capital expenditure for Chinese set-ups is based upon literature, while depreciation for Indian manufacturing set-ups is calculated on the basis of capital expenditure estimation announced by Indian manufacturers in their draft red-herring prospectus (DRHP) documents. The depreciation calculation is shown in Annexure 5.
Consumables and capital expenditure are the major cost drivers that make Indian solar cell manufacturing more expensive than Chinese solar cell manufacturing. The next sections will explore the reasons behind this.
2.2 Cost attributed to various consumables
1. Wafer
For domestic solar cell manufacturing, wafer consumption is the highest cost driver, as shown in Figure 9. Domestic cell manufacturers depend on imported wafers, predominantly from China, which has 95 per cent of the global wafer manufacturing capacity (IEA 2024). The concentration of wafer manufacturing in China makes it vulnerable to disruption, and entails that a majority of the value addition for the domestic solar supply chain is situated outside. For example, a 7.7-magnitude earthquake on the Richter scale hit Myanmar on 28 March 2025, affecting China’s wafer production areas, particularly regions like Sichuan, Ningxia, Yunnan, and Inner Mongolia (InfoLink Consulting 2025b). The earthquake caused equipment issues such as wire breaks and furnace explosions, affecting production output, supply-demand balance, and thus leading to a 5–10 per cent increase in wafer price (JA Solar Tech 2025). Policy changes, including the lapse of the BCD exemption on imported silicon inputs and un-diffused wafers from 1 April 2026 will impact the cost of imports, leading to a direct cost escalation for Indian solar cell manufacturers (Ministry of Finance 2026). The measure compresses profit margins and structurally favors vertically integrated domestic producers with wafer capacity.
Wafer sizes have kept increasing, with a predicted market shift from M10 wafers, which have a dimension of 182 mm x 182 mm, towards G12 wafers and G12 rectangular wafers, which have a dimension of 210 mm x 210 mm and 210 mm x 182 mm, respectively (VDMA 2025). The shift to larger and rectangular wafers has led to greater power output of solar cells, and provided flexibility for manufacturers to produce solar cells of varying sizes, tailored to their module size requirements. Due to rapid changes in wafer size and shape, and changes to equipment required to process the wafers, manufacturers face uncertainty (VDMA 2025).
2. Silver paste
Silver paste is made using silver particles, glass frit, and an organic binder, and is produced by mixing, rolling pulp, and other processes (Maysun Solar 2023b). The process of making silver paste requires optimisation of the size and shape of silver paste particles, and has strong intellectual property protections (CEEW 2022). For a TOPCon solar cell, keeping aside the cost of importing wafers, silver paste consumption can contribute at least 20 per cent of the entire cost outside China (APVI 2024).
Import dependence for silver paste
Domestic manufacturers are completely import-dependent for sourcing silver paste from a few regions like China, Hong Kong, Taiwan and Singapore1 , predominantly under two HS codes2 : 71069290 and 71159010 (Ministry of Commerce 2025). The total value of commodities imported under these two HS codes are showcased in Figure 10 and Figure 11. The description of each of the HS codes are:
• 71159010: Other articles of precious metal or metal clad with precious metal.
• 71069290: Silver (including silver plated with gold or platinum), unwrought, semimanufactured, or powder form.
1. According to stakeholder consultations.
2. The Harmonised Commodity Description and Coding System, generally referred to as ‘Harmonised System’ or simply ‘HS’ is a multipurpose international product nomenclature developed by the World Customs Organization (WCO). It comprises more than 5,000 commodity groups, each identified by an eight-digit code, arranged in a legal and logical structure, and is supported by well-defined rules to achieve uniform classification (World Customs Organization 2025).
Analysis of import share changes across years for commodities under both HS codes reveals that imports under HS code 71069290 are distributed across multiple countries, as shown in Figure 12. This suggests that the HS code encompasses a range of commodities beyond silver paste. Given that silver paste is primarily sourced from China, the presence of significant import shares from other countries indicates the inclusion of other materials under this classification.
In comparison, imports under HS code 71159010 have consistently been dominated by China over the years, as illustrated in Figure 13.
Overall, the difference in import volume and import share between the two HS codes signals a lack of clarity in classifying conductive silver paste into HS codes, which causes a lack of traceability of silver paste imports for solar PV manufacturing.
Cost contribution of silver paste to solar cell manufacturing
As of February 2026, front-side silver paste for fingerprinting, front-side silver paste for busbars, and rear-side silver paste were priced at USD 2,473 per kg (Shanghai Metals Market 2025b), USD 2,566 per kg (Shanghai Metals Market 2025a), and USD 1,712 per kg (Shanghai Metals Market 2025c), respectively. For Indian solar cell manufacturers, silver paste effectively costs 24 per cent more than Chinese competitors. This is due to a combined effect of import duties on silver paste, and subsidies granted to Chinese manufacturers upon sourcing silver paste from Chinese players. Assuming a 13.5 mg per Wp (VDMA 2025) consumption of silver paste for TOPCon solar cell, the base cost contributed by silver paste alone for cell manufacturing is USD 0.0314 per Wp. Further, silver paste imported to India under the two HS codes is subject to a 10 per cent customs duty (Central Board of Indirect Taxes and Customs 2025), raising costs to USD 0.0345 per Wp. In comparison, Chinese manufacturers benefit from subsidies of approximately 11.5 per cent on silver paste sourced domestically (APVI 2024), reducing their effective cost to USD 0.0278 per Wp. A comparison of these silver paste costs, base price and post-duty cost in India, and subsidised cost in China, is presented in Figure 14.
The removal of import customs duty on silver paste can bring the cost differential between Indian and Chinese players down from 24 per cent to 13 per cent.
Rising silver demand due to solar PV
Apart from rise in silver costs due to import dependence, there is a demand-supply imbalance, leading to rise in prices. At the end of 2025, total silver demand across various applications was 32,554 tonnes, eclipsing total silver supply at the end of 2025, which was 29,217 tonnes (The Silver Institute 2025). Further, silver demand from solar PV applications reached 17 per cent of total demand in 2025, rising from 8 per cent in 2016, as shown in Figure 15.
Figure 15 shows silver demand overtaking the supply, coinciding with the rise in silver demand from solar PV, which may entail a potential risk from rising silver prices. A long-term solution would be to either reduce silver paste consumption, or explore alternative materials to lower costs.
Technological advances in the reduction of silver paste consumption
One of the technical advances underway is the shift from multi busbar (MBB) technologies, which consist of nine busbars per solar cell of the thickness of 0.3 to 0.4 mm, to smart multi busbars (SMBB), which consist of 16 to 20 busbars per solar cell, enabling the usage of finer busbars of the thickness of 0.24 mm (Maysun Solar 2023a). Finer busbars reduce silver paste use, minimise shading, and lower electrical resistance, leading to lower costs and higher efficiency. A further shift from SMBB to zero busbar (0BB) technology is expected, as it eliminates the need for busbars by connecting the silver fingers with the ribbons attached to the modules, further reducing silver consumption, shading, and electrical resistance. Zero busbar technology can reduce silver paste consumption by 30 per cent, but is currently in the early stages of industrialisation, optimising the exact process of connecting the ribbons to the silver fingers (Maysun Solar 2024).
Assuming a silver consumption of 13.5 mg per Wp for TOPCon, a 30 per cent reduction through 0BB technology will lead to a reduction in silver consumption to 9.45 mg per Wp. This leads to a 30 per cent reduction in silver paste cost, pushing it down to USD 0.0242 per Wp and USD 0.019 per Wp for Indian and Chinese players respectively. However, R&D for such technologies are being led by Chinese manufacturers; Indian manufacturers lag behind in research and development due to a lack of industry and academia collaboration, a lack of R&D investment, and focus on scaling up commercialised technologies.
The market share for both SMBB and 0BB technologies is expected to increase from approximately 45 and 5 per cent respectively in 2024 to approximately 50 and 45 per cent in 2035 (VDMA 2025), with a decrease in the market share for MBB technologies from 50 to nearly 5 per cent in 2034 (VDMA 2025), as shown in Figure 16. Implementing advanced busbar technology in domestic cell manufacturing requires sourcing suitable equipment as well as developing the technical expertise to operate it. Chinese manufacturers are a step ahead in commercialising such technologies due to their close collaboration with their equipment suppliers, thus ensuring higher performance and, in this particular case, lower costs.
Another novel method of reducing silver paste consumption is replacing silver paste with a mixture of silver and copper paste (Taiyang News 2023a). In such pastes, copper particles are coated with silver, reducing the amount of silver required. These pastes, now entering commercialisation, are primarily aimed at HJT solar cells, which consume more silver than TOPCon cells (Taiyang News 2023a). Currently, hybrid silver and copper paste metallisation ratios of 20 per cent and 70 per cent are commercially available for HJT solar cell manufacturing (Taiyang News 2025a).
Adopting novel technological innovations such as 0BB and hybrid silver-copper pastes, can reduce silver consumption by 30% and 80% respectively.
3. Chemical consumables
The chemical consumables used in solar cell manufacturing consist of hydrochloric acid (HCl), hydrogen fluoride (HF), nitric acid (HNO3 ), potassium hydroxide (KOH), deionised water, and gases such as Diborane (B2 H6 ) and Silane (SiH4 ). Hydrochloric acid, hydrogen fluoride, nitric acid, and potassium hydroxide are used in surface damage etching and texturing, the initial steps of solar cell manufacturing. Chemicals such as deionised water are required in edge isolation, performed after emitter formation through diffusion (Taiyang News 2023b). Chemical gases like diborane and silane are used as feedstock material for emitter formation and passivation layer deposition. According to stakeholders, these gases are imported from outside, stored in bottling plants, and then transported to manufacturing facilities in tankers. Transportation and storage of these chemicals increase the indirect costs through warehousing and tanker requirements, creating a logistical challenge. For example, silane is an explosive chemical which must be stored offsite, and transported at USD 0.09 per km per tonne. This cost gets embedded into the overall manufacturing cost.
2.3 Indian solar cell manufacturing requires nearly twice the capex of China
Table 1 compares the capital expenditure3 estimated from analysing the DRHP documents of two domestic manufacturers, Vikram Solar (Vikram Solar 2024) and Premier Energies (Premier Energies 2024). The original tables have been attached in Annexure 4.
3. The numbers originally were mentioned in INR million; they have been converted to USD million for uniformity.
From Table 1, the average capital expenditure for establishing TOPCon cell manufacturing facilities is around USD 70 million per GW. In China, estimated capital expenditure for TOPCon cell manufacturing facilities can range from USD 25 million per GW (APVI 2024) to an average of USD 42 million per GW (CRISIL 2024). Thus an average of USD 33.5 million per GW of capital expenditure can be considered, which is nearly 48 per cent of India’s capex. Hence, Indian manufacturers require almost double the capital expenditure to set up solar cell manufacturing facilities compared to Chinese manufacturers. As the capital expenditure incurred for equipment and machinery significantly varies in India and China, the depreciation calculated based on their useful life under the straight-line method will also significantly vary. As depreciation is a revenue expenditure, it will affect the profitability of the company.
Stakeholder consultations reveal that the lower capital expenditure in China is due to the country’s larger manufacturing facilities, with dozens of GWs (Renewable Energy Institute 2024), leading them to reach economies of scale quicker. India’s largest solar cell manufacturing capacity is 5.4 GW, and the average size of a facility is around 2 GW (Sinovoltaics 2024), leading to longer time to achieve profitability. Additionally, Chinese manufacturers benefit from lower infrastructure costs, lower equipment costs sourced from Chinese manufacturers with no shipping costs, and subsidies for capital expenditure for building, civil works, and land, all of which reduce capital expenditure.
Expanding domestic cell manufacturing would ensure supply chain resilience and higher domestic value addition – solar cells contribute nearly 60 per cent of the total module cost. By scaling up, reducing manufacturing costs, and accelerating technology adoption, India's solar cell manufacturing can support both domestic energy transition and build a globally competitive solar ecosystem.
Import duties on silver paste drive up consumable costs. Lack of economies of scale and limited access to subsidised infrastructure drive up capital expenditure. These two factors together lead to higher manufacturing costs.
Domestic manufacturers are dependent on imported equipment. This results in manufacturers remaining dependent on the know-how required to carry out installation and process optimisation. This results in slower commissioning of facilities for newer advanced cell technologies such as TOPCon. The lack of know-how also results in limited ability to upskill process engineers and technicians, who are critical for scaling up cell manufacturing capacities. In addition, weak public and private solar R&D leads to constraints in the timely adoption of next-generation technologies.
Establishing shared manufacturing infrastructure to reduce utility costs, localise equipment, and shared pilot-scale R&D facilities would be essential to become cost and technology-competitive. Further, targeted capital subsidies, developing dedicated skilling programmes, and strategic technology transfers would complement these measures.
Establishing a Sodium-ion Battery Ecosystem in India
Making India a Hub for Critical Minerals Processing
State of the Sector: Critical Energy Transition Minerals for India
Strengthening India's Clean Energy Supply Chains
