India is reassessing the launch of its first 1 gigawatt (GW) offshore wind power tender as rising global costs and weak developer interest in similar auctions abroad raise concerns over investor participation, a top government official told Down To Earth (DTE).
The reassessment follows a setback last year when the Solar Energy Corporation of India (SECI) cancelled two offshore wind tenders totalling 4.5 GW in August 2025 after failing to attract developer interest. The tenders included a 4 GW seabed lease rights auction issued in February 2024 for projects off the coast of Tamil Nadu and a 500 MW interstate transmission system (ISTS)-connected offshore wind project issued in September 2024 off the coast of Gujarat. The cancellations were announced around August 13-14, 2025, after multiple extensions to bid submission deadlines still failed to bring in sufficient bids from developers due to the lack of interest in the high capital intensity of offshore wind projects, technical complexity and limited supporting infrastructure in India.
Despite the setback, the government continued preparations for the next round of auctions. Speaking at the Windergy conference in Chennai in October 2025, Pralhad Joshi, Union minister for the Ministry of New and Renewable Energy (MNRE), said the ministry was reworking the tender and that the next auction could be finalised by May-June, subject to the completion of surveys by the National Institute of Wind Energy (NIWE), an autonomous institution under MNRE. The survey has since been completed.
The official informed that NIWE has already submitted its survey report and the ministry has already reworked the 1 GW offshore wind tender but is evaluating whether to proceed immediately.
“NIWE has submitted it. Their survey is over. In fact, our tender for that 1 gigawatt is ready, but given the rate of failures in the western part of the world and our discussions with stakeholders suggests that we may not receive sufficient interest for a 1-gigawatt tender, we are re-evaluating whether we will go for it right now or wait,” the official from MNRE told DTE on March 11, on the sidelines of the International Solar Alliance Foundation Day event, attributing the hesitation largely to high project costs.
“We are now engaging with think tanks, including with the World Bank, to see what kind of a roadmap will encourage developers to come in and invest in offshore wind projects,” the official added.
Any government support, if offered, is unlikely to come through production-linked incentives, the official said. “It will not be in the form of a PLI. If it comes, it will be in the form of CAPEX support. In the PLI we had given earlier, but it didn’t work out. So, we are definitely not adopting that.”
The challenges faced by the sector extend beyond financing. At a press conference in Chennai in October 2025, Santosh Sarangi, secretary of MNRE, acknowledged that India’s initial offshore wind tenders had to be scrapped because there were “no participants” due to financial and technical unviability.
Costs remain a key barrier. The global offshore wind sector is facing significant difficulties, with project costs increasing by an estimated 40-60 per cent since 2020 due to macroeconomic factors, including inflation and supply-chain bottlenecks, according to a July 2024 report by US-based consultancy McKinsey & Company.
According to a 2019 JMK Research & Analytics report, tariffs in India for offshore wind are expected to be in the range of Rs 7-9 per unit against the prevailing rate of Rs 2.8-2.9 per unit for the onshore wind.
The levelised cost of energy (LCOE)—a measure of the average cost of producing electricity over a project’s lifetime—remains high at Rs 9.7-Rs9.8 per unit, Amit Pathare, head of strategy at Suzlon Energy, told DTE in October 2025.
Industry experts also point to procedural rigidity as a deterrent for international developers. “Indian tenders demand submissions in 100-120 days, but European firms need six to seven months for internal approvals,” Francis Jayasurya, India director of Global Wind Energy Council (GWEC), a Lisbon-based industry body, earlier told DTE. Offshore wind projects also require multiple approvals across ministries and “no one wants to be the nodal authority”, he added.
Social considerations present another layer of complexity as fishers often view offshore wind zones as encroachments on their traditional fishing grounds. “Policymakers must integrate fishing communities into planning to build trust and avoid conflict,” Jayasurya said.
Despite the hurdles, the government continues to view offshore wind as a crucial component of India’s long-term renewable energy strategy. According to a 2025 government press statement, India plans to auction 37 GW of offshore wind capacity by 2030. To kick-start the sector, the Union government has already approved Rs 7,453 crore in viability gap funding to support the first 1 GW of offshore wind capacity—500 MW each in Tamil Nadu and Gujarat. The goal is to demonstrate technical feasibility, attract global developers, and catalyse India’s entry into the global offshore market.
Experts say launching the first project remains the biggest challenge. “Offshore wind is relatively slow moving. It is a major infrastructure sector and a major capital deployment,” Charles Ogilvie, executive director and co-founder of Ocean Energy Pathways (OEP), a global offshore wind non-profit, told DTE. “You cannot start with one turbine and then decide to build two more. You have to start with a commitment to scale.”
He noted that offshore wind projects typically take six to seven years to connect to the grid, making pricing and demand projections difficult. “When you are designing an energy project that might connect to the grid in 2032 or 2033, it becomes difficult to know what the right price or the right volume of power will be,” Ogilvie said. “The first-of-a-kind project is always more expensive. Governments need to take a moment of leadership and bold risk-taking to get that first project done and build the supply chain in the country.”
However, early projects could help establish a domestic offshore wind ecosystem. “If I were an Indian citizen, I would want to see strong participation from Indian innovation and engineering in this sector,” OEP's executive director said. “Then you can say the first project was expensive, but it helped build an industry.”
A February 2025 analysis by OEP, supported by the Global Wind Energy Council and COWI, identified Tamil Nadu as a potential offshore wind manufacturing hub capable of generating Rs 6,500 billion (€72 billion) in economic activity by 2030.