Finance Ministry clears in principle MNRE's proposed scheme to support domestic solar polysilicon manufacturing

Key facts

• The Ministry of Finance has given in-principle approval to a proposal by the Ministry of New and Renewable Energy (MNRE) to launch a special scheme supporting domestic polysilicon manufacturing, with the proposal to be moved to the Cabinet, hopefully within a month.
• Polysilicon, a highly purified form of silicon, is the primary raw material for over 95 per cent of solar panels globally and is the only segment of India's domestic solar value chain not currently covered by a support mechanism.
• The government targets 30,000 megawatt of domestic polysilicon manufacturing capacity by 2030, requiring an investment of around ₹25,000 crore, according to MNRE Secretary Santosh K Sarangi.
• Existing support measures across the rest of the solar value chain include the production-linked incentive (PLI) scheme and the approved list of models and manufacturers (ALMM); India's solar module manufacturing capacity stands at 225 gigawatt and cell capacity at 37 gigawatt, expected to rise to 50 gigawatt by March 2027.
• Chinese firms account for more than 93 per cent of global polysilicon production, which is also a key feedstock for the semiconductor industry.
• ALMM List-I for solar modules is in force, List-II for solar photovoltaic cells came into effect in June this year, and List-III for ingots and wafers, introduced in March, requires solar projects to source these components locally from June 2028.