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The Union Ministry of New and Renewable Energy is working on a Production Linked Incentive scheme to support domestic polysilicon manufacturing, a senior official said.
India has more than 213 GW of solar module manufacturing capacity and 32 GW of solar cell capacity, but remains fully dependent on imports from China for polysilicon.
MNRE Secretary Santosh Sarangi said polysilicon should be treated as a separate industrial activity because it is also used in the semiconductor industry.
The proposed scheme is expected to support more than 10 GW of capacity, though its size, structure and participating companies have not yet been disclosed.
The Union Ministry of New and Renewable Energy is working on a Production Linked Incentive scheme for polysilicon manufacturing as India seeks to fill a major gap in its domestic solar supply chain, according to ministry secretary Santosh Sarangi.
The scheme was expected to have been announced by now but has been delayed. The government is examining polysilicon manufacturing as a separate industrial activity because it is primarily a chemical and refining process and is not limited to the solar value chain, he said.
“People put up cell manufacturing, module manufacturing, a little bit of ingot, but nobody actually put up polysilicon,” Sarangi said on the sidelines of the 7th Confederation of Indian Industry International Energy Conference and Exhibition in New Delhi on August 7, 2026.
Polysilicon is a key raw material used in solar photovoltaic panels. India relies entirely on imports from China for the material, which is the starting point for crystalline silicon solar cells and sits at the upstream end of the solar manufacturing chain, before ingots, wafers, cells and modules.
India has rapidly expanded manufacturing capacity further downstream, but polysilicon remains a missing link in the domestic value chain. The proposed support scheme is aimed at encouraging investment in this upstream segment.
Sarangi said high-purity polysilicon can also be used in the semiconductor industry. The government therefore believes the segment should be treated as an independent industry, rather than only as part of solar manufacturing.
The size and structure of the proposed support scheme have not yet been disclosed. Sarangi did not specify which companies could participate, but indicated that the scheme would support more than 10 gigawatts of capacity.
The proposed polysilicon support is separate from the ministry’s existing Production Linked Incentive scheme for solar photovoltaic modules. Sarangi said the existing PLI scheme had helped cell and module manufacturing come up in India, along with some ingot capacity, but polysilicon manufacturing had not materialised.
India now has more than 213 gigawatts of solar module manufacturing capacity and more than 32 gigawatts of solar cell manufacturing capacity, Sarangi said while addressing the CII event. Based on industry declarations, around 100 GW of solar cell manufacturing capacity could be added over the next year, he said.
The government has also introduced the approved list of models and manufacturers for ingots and wafers, and expects at least 80 GW of ingot and wafer manufacturing capacity, Sarangi said.
Separately, the latest round-the-clock renewable energy bid conducted by the Solar Energy Corporation of India (SECI) has discovered a tariff of Rs 5.25 per unit.
The bid provides for 90 per cent assured power availability in each time block, with solar accounting for only 50 per cent of supply during the daytime.
“We expected the price to be very high, but thanks to the competitive spirit among our developers, we discovered a rate of Rs 5.25 only per unit for RE RTC,” Sarangi said.
He said the tariff profile of the round-the-clock renewable energy bid almost matches nuclear power. Developers had designed their systems on the assumption that they could supply power at an inflation-proof price of Rs 5.25 per unit for the next 25 years, he added.
The RE RTC model combines renewable energy technologies and storage to provide assured power availability. Sarangi said the bid showed the ability of developers to integrate solar, wind and storage technologies to provide reliable electricity.
SECI has been trying new bidding models to improve the saleability of renewable power. The agency has already conducted bids for solar plus storage and wind energy, and has now moved to RE RTC.
SECI is also trying a 500MW contract for difference, which could be scaled up if successful, Sarangi said.
Sarangi said combinations of solar and wind, solar and storage, and RE RTC projects could help reduce the average power procurement cost of distribution companies.
The average cost of power purchased by DISCOMs has either declined or remained stagnant over the past three years after rising rapidly earlier, he said. He attributed the change to the addition of cheaper renewable energy to the power portfolio.
The government hopes the average power procurement cost can fall from around Rs 5.20 per unit currently to about Rs 4.85 per unit through combinations of solar and wind, solar and storage, and RE RTC projects.
Sarangi said this could make Indian industry more competitive, encourage data centres to expand and support India’s green transition and net-zero ambition.
India has already crossed 300GW of non-fossil fuel energy installations and is targeting 500GW of non-fossil fuel capacity by 2030.
Sarangi said the government is also creating markets for green hydrogen and other emerging fuels by supplying green ammonia to fertiliser plants and green hydrogen to oil refineries.
The government is conducting pilots for green methanol in shipping, while SECI has launched a tender for 5 lakh tonnes of green methanol supply to aggregate demand and supply for shipping companies.
Pilots are also being conducted in the transport sector to assess green hydrogen, and in the steel industry to examine its use in direct reduced iron plants.
Sarangi said cross-border energy cooperation required both physical infrastructure and compatible regulatory systems. “When we talk of cross-border energy trade, we are not talking merely of the hardware of putting wires, putting transformers, substations or undersea cables. It is equally important to talk of the software relating to cross-border energy transmission,” he said.
SECI is working with Bhutan on a large solar power plant, while Tata Power is also working with Bhutan to promote solar power.
Anura Karunathilake, Sri Lanka’s Minister of Energy, referred to the proposed India-Sri Lanka grid interconnection and said the region’s energy future should focus on creating a resilient, interconnected and competitive regional electricity market.
He said such a market could accelerate the clean energy transition, strengthen energy security and promote sustainable economic growth.
Karunathilake called for a regional approach beyond bilateral interconnections. He said linking solar and wind resources across countries with Bhutan’s hydropower could improve system reliability, reduce the need for costly national reserves and deliver more affordable electricity.
He said careful planning, sound regulations, mutual trust and harmonised regulatory frameworks would be essential to building an integrated South Asian energy market.
Dammu Ravi, former secretary for economic relations at the Ministry of External Affairs, stressed the importance of regulatory alignment, investment and entrepreneurship in enabling cross-border energy trade.
Ravi said the “India model is eminently global” and could be replicated by other countries, allowing them to learn from each other.