Tariffs imposed by the US are expected to offer a slight edge to certain Indian solar equipment manufacturers over their peers in China and Vietnam as imports from the former face lower tariff barriers.
However, India solar equipment manufacturers and project developers are likely to feel the pinch of higher tariffs as certain machinery and components, advanced turbines or solar panel technology are imported from the US.
Industry feels that tariffs could help push up Indian module exports to the US to some extent. Globally, China dominates the module market with 65 per cent share followed by Vietnam (21 per cent).
The US imposed 26 per cent tariffs on Indian exports, 46 per cent on Vietnam and a cumulative 54 per cent on China.
Slight Export Edge
Sambitosh Mohapatra, Leader for ESG/ Climate & Energy at PwC India, said, “The tariffs hit competitors like China and Vietnam harder, potentially diverting US demand for energy-related goods elsewhere. India could benefit if it ramps up exports of exempted energy products or related manufacturing (e.g., solar panels), but its current capacity is geared more domestically or toward other markets.”
On costlier imports, he explained that India’s energy sector, particularly renewables such as solar and wind, relies on imported machinery and components, some from the US (e.g., advanced turbines or solar panel technology).
“While energy commodities are exempt, tariffs on machinery (with a 5.3 per cent tariff gap as per GTRI) or electronics (7.2 per cent gap) could increase costs for Indian firms if US-sourced equipment falls under the 27 per cent levy. This might raise capital expenses for projects, though the US isn’t a dominant supplier here — China and Europe often lead,” Mohapatra pointed out.
Ankit Hakhu, Director at Crisil Ratings, said: “The US will likely continue to rely on imports, particularly for solar cells, due to its limited domestic capacity and preference for Indian manufacturers over Chinese and South-East Asian suppliers,” he added.
Tariffs could impact margins of manufacturers as 20-25 per cent of domestic production is exported – most of it to the US – where sales are more profitable, he anticipated.
“However, growing domestic demand will absorb some of the likely reduction in export volume. Domestic market is also protected by tariffs (basic customs duty: 20 per cent) and non-tariff barriers (Approved List of Models and Manufacturers since April 2024 and Approved List of Cell Manufacturers from June 2026),” Hakhu pointed out.
Import Dependence
However, India’s dependence on Chinese imports is a concern.
Rubix Data Sciences, a risk management services provider, in a March 2025 report said the US accounts for over 90 per cent of India’s PV cell and module exports, yet India represents only 11 per cent of total US panel imports (as of Q2 2024), indicating tremendous potential.
However, India remains dependent on China for over 50 per cent of its solar PV cell and module components, particularly polysilicon and wafers. If China redirects its excess supply to India at lower prices to compensate for US losses, domestic manufacturers may struggle with margin pressures and price competition, it added.
Rubix report said that until FY24, Waaree Energies, Adani Solar and Vikram Solar were major players in India’s PV exports. Other manufacturers such as Grew Energy, Navitas, Solex Energy, and Saatvik Energy are also expanding into global markets and establishing supply chains overseas.
Waaree Energies CEO Amit Paithankar said tariff imposition offers an opportunity to reassess and strengthen the RE supply chain, without impacting industry’s strong long-term growth trajectory.
“At Waaree, we have proactively anticipated potential policy shifts and have built a resilient supply chain to navigate such geopolitical uncertainties. Our diversified manufacturing presence, including Waaree Solar Americas, ensures that we remain agile in serving the US market while upholding our global commitments,” he added.