India has extended by seven months an exemption from mandatory domestic sourcing of solar cells for certain renewable energy projects, a move that has unsettled some local manufacturers. The relief applies to select segments including open access and net metering projects, allowing them to continue using cells that do not have to meet the local sourcing requirement.
Manufacturers say the policy change could create uncertainty for investors who were tracking the growth of India’s solar manufacturing base. According to industry concerns, repeated or prolonged relief measures can make it harder to assess demand for locally made cells and may weaken confidence in expansion plans.
The decision also raises questions around production planning. Domestic producers typically align output, capacity and investment decisions with expected policy support and market demand. When sourcing rules are relaxed for part of the market, companies may face difficulty in forecasting orders and timing new investments.
At the same time, the extension offers flexibility for developers in project categories covered by the exemption, potentially helping avoid supply constraints or delays. The debate now centers on how India balances near-term project execution with the long-term goal of building a stable domestic solar manufacturing ecosystem.
