By Sakshi Bansal
China has dominated solar PV cell imports in India as well as the rest of the world. A significant factor behind this dominance is China’s oversupply of solar cells, which has led to the dumping of these cells at prices below production costs in an effort to clear excess inventory. While imported cells have traditionally enjoyed a cost advantage due to China’s massive scale, this dynamic is slowly shifting. Various global solar markets are adopting the “China+1” strategy focusing on the diversification of supply chains rather than depending on just one nation. These nations are also expanding their own manufacturing capabilities in the solar cell domain, India being one of them.
The Indian solar private sector, backed by supportive policy frameworks and investments in innovation, is setting up new solar cell manufacturing facilities and ramping up production. This is expected to lead to a decrease in costs, allowing domestic manufacturers to compete directly with global suppliers. Although this expansion of domestic solar cell manufacturing facilities has faced delays, it is crucial for strengthening India’s solar supply chains as it helps the industry move beyond merely assembling PV modules.
To this end, the Ministry of New and Renewable Energy (MNRE) in September 2024 proposed a draft amendment to include solar cells within the Approved List of Models and Manufacturers (ALMM) from April 1, 2026, aiming to align with the increasing domestic production capacity. Following this amendment, the MNRE in December 2024 announced the inclusion of solar PV cells in the newly introduced List-II under the ALMM. This amendment will take effect from June 1, 2026, and marks an expansion of the ALMM framework, which previously only covered solar modules. Projects required to use ALMM-enlisted solar modules from List-I will also need to ensure that the modules are manufactured using solar cells listed under List-II from June 1, 2026 onwards.
List-II was first announced in 2019 but was never implemented due to the country’s limited installed capacity of solar PV cells, which fell short of demand. However, with the expected substantial increase in the domestic installed capacity of solar PV cells in the next two years, this issue is expected to be resolved.
As per the new directive, any modules that do not use solar cells listed in List-II will be removed from ALMM List-I. However, exemptions apply to projects with bid submission deadlines preceding the issuance of this order, regardless of their commissioning date. Furthermore, tenders issued after the introduction of List-II will explicitly include provisions mandating the use of both ALMM List-I- and List-II-certified products. Projects commissioned before June 1, 2026 must comply if their bidding aligns with the revised timeline. Net metering and open access renewable energy projects required to use ALMM-listed modules will also need to adhere to List-II requirements after June 2026, unless commissioned before the cut-off date. Thin-film technology-based modules manufactured in integrated facilities listed under ALMM List-I will be considered compliant with List-II regulations. Additionally, from June 1, 2026, a separate List-I(a) will be maintained for modules meeting List-I criteria but not using cells from List-II. These modules will be applicable only for exempted projects. The MNRE further plans to release detailed procedural guidelines for enlisting solar cell models and manufacturers under List-II in the coming months.
Outlook
The Indian solar sector is poised for another pivotal shift as the MNRE rolls out its draft proposal to introduce ALMM List-II for solar PV cells. It is expected to affect solar project timelines and costs. A similar shift occurred when solar modules were included in the ALMM.
While it is vital to expand domestic supply chain security, it needs to be done in a phased and planned manner, to avoid disrupting the current pace of solar development. Further, the present policy decisions must be fully implemented and policy flip-flops should be avoided. As India’s current solar cell manufacturing capacity is limited compared to the immense demand, module manufacturers will continue to rely on massive imports of cells, at least till production capacity ramps up. This means that solar cell imports may go up before the deadline of June 2026, when ALMM order compliance takes effect.
Overall, while the short-term impact of this new ALMM policy may lead to temporary disruption, the long-term outlook remains optimistic. As domestic manufacturing scales up, production costs are expected to stabilise. This will lead to a more secure supply chain, aligning with India’s broader goals of self-reliance and energy security.