Govt. working on additional subsidy scheme for polysilicon manufacturing: Official
The Ministry of New and Renewable Energy (MNRE) is working on an additional subsidy scheme specifically for polysilicon manufacturing, beyond the existing Production Linked Incentive (PLI) framework for solar PV
An MNRE official stated that India would need about 30 GW of polysilicon manufacturing capacity by 2030 to secure energy needs and build domestic manufacturing resilience
The move follows an assessment that capacity likely to come up under the existing PLI scheme for polysilicon would be limited relative to what is required
Setting up 1 GW of integrated polysilicon (with metallurgical-grade silicon) capacity is estimated to require an investment of about ₹850 crore
Polysilicon and the Solar PV Manufacturing Value Chain
Polysilicon is the highly purified (typically 99.9999% pure, "6N" or higher grade) form of silicon that is the foundational raw material for crystalline-silicon solar cells, the technology used in the vast majority of solar panels installed globally. The value chain runs polysilicon → ingots/wafers → solar cells → solar modules; India currently has meaningful capacity only in the downstream module and cell stages, with almost no domestic polysilicon production, making it heavily import-dependent for this upstream link.
Key Details
- Polysilicon production is capital- and energy-intensive, and is currently dominated globally by China, which accounts for the overwhelming majority of world polysilicon capacity
- India's solar manufacturing base has expanded rapidly at the module and cell stage under government incentives, but polysilicon and ingot/wafer capacity remain the weakest links
- Estimated investment requirement: about ₹850 crore per GW for a polysilicon plant (including associated metallurgical-grade silicon production)
- Achieving self-reliance in polysilicon would close the last major import-dependent gap in India's solar manufacturing chain
The proposed subsidy scheme directly targets this upstream gap, aiming to localise polysilicon production so that India's already-large module/cell manufacturing base is not dependent on imported raw material.
PLI Scheme for High Efficiency Solar PV Modules
The Production Linked Incentive (PLI) Scheme for the National Programme on High Efficiency Solar PV Modules was approved by the Union Cabinet in April 2021 to build an integrated domestic solar manufacturing ecosystem, with incentives disbursed in proportion to sales of eligible high-efficiency modules over five years.
Key Details
- Total outlay of ₹24,000 crore across two tranches: Tranche-I (Letters of Award issued November-December 2021, ~8,737 MW capacity) and Tranche-II (Cabinet approval 21 September 2022, outlay ₹19,500 crore; Letters of Award issued April 2023 for ~39,600 MW of fully/partially integrated capacity)
- The scheme rewards "fully integrated" bidders (polysilicon to module) more favourably than those covering only later stages, in an effort to pull investment upstream
- Despite this design, actual polysilicon capacity build-out under the PLI scheme has lagged targets, prompting the government to consider a dedicated additional support mechanism
- The scheme is administered through the Indian Renewable Energy Development Agency (IREDA) and the Solar Energy Corporation of India (SECI)
The article's "additional subsidy scheme" is explicitly framed as supplementing the existing PLI scheme because polysilicon capacity emerging from PLI alone is expected to fall short of the 30 GW target, indicating a policy gap the government is now trying to close.
Approved List of Models and Manufacturers (ALMM) and Domestic Content Requirement (DCR)
Alongside production incentives, MNRE uses demand-side tools to protect and grow domestic solar manufacturing: the Approved List of Models and Manufacturers (ALMM) restricts government-scheme projects to modules/cells from listed domestic manufacturers, while the Domestic Content Requirement (DCR) mandates use of India-made cells and modules in specific programmes such as PM Surya Ghar.
Key Details
- ALMM List-I covers solar PV modules; ALMM List-II (introduced later) extends the same requirement to solar PV cells
- Projects under government programmes and DCR-linked schemes must source from ALMM-listed manufacturers
- These demand-side measures work alongside supply-side incentives (PLI, and now the proposed polysilicon subsidy) to build a complete domestic manufacturing ecosystem
- The measures are part of the broader push toward India's renewable energy target of 500 GW of non-fossil fuel-based capacity by 2030
ALMM and DCR create guaranteed domestic demand for Indian-made solar components; the proposed polysilicon scheme aims to extend this self-reliance push one step further up the value chain, to the raw material stage that current policies have not adequately addressed.
- Target: about 30 GW of domestic polysilicon manufacturing capacity by 2030 (as stated by MNRE)
- Estimated investment requirement: approximately ₹850 crore per GW of polysilicon capacity (including metallurgical-grade silicon)
- Existing PLI Scheme for High Efficiency Solar PV Modules: total outlay ₹24,000 crore across two tranches (approved April 2021)
- Tranche-I: ~8,737 MW capacity awarded (2021); Tranche-II: ₹19,500 crore outlay, ~39,600 MW awarded (2023)
- India's broader renewable energy target: 500 GW of non-fossil fuel-based capacity by 2030
- China dominates global polysilicon production capacity, underscoring India's import dependence in this segment