🌞 Introduction
India is rapidly becoming a global hub for solar manufacturing, and one of the biggest catalysts behind this transformation is the Production Linked Incentive (PLI) Scheme. Designed to support the “Atmanirbhar Bharat” vision, the PLI scheme encourages companies to manufacture high-efficiency solar PV modules and reduce India’s dependence on imported solar equipment.
In this guide, we simplify the PLI scheme, its benefits, eligibility, financial incentives, and how it is shaping India’s renewable energy future.
🌍 What Is the PLI Scheme for Solar Manufacturing?
The PLI Scheme for High-Efficiency Solar PV Modules was launched by the Government of India to support domestic manufacturing of:
Solar cells
Solar modules
Integrated polysilicon–wafer–cell–module manufacturing
The scheme rewards manufacturers based on their output, efficiency, and domestic value addition.
⚡ Objectives of the PLI Scheme
The scheme aims to:
✔ Reduce dependency on foreign imports
India currently imports solar cells, modules, and polysilicon mainly from China and Southeast Asia.
✔ Strengthen domestic manufacturing
Encourage companies to set up factories and produce high-quality solar components in India.
✔ Promote high-efficiency technology
Only manufacturers producing high-efficiency PV modules and adding domestic value get incentives.
✔ Support large-scale solar deployment
India targets 500 GW of renewable energy capacity by 2030, and PLI accelerates local supply.
🧩 Components of the PLI Scheme
The scheme supports three levels of manufacturing:
🔹 1. Fully Integrated Manufacturing (Polysilicon to Module)
Maximum incentive
Highest value addition
Top priority applicants
🔹 2. Partial Manufacturing (Wafer–Cell–Module)
Moderate incentive
🔹 3. Solar Cells & Modules Only
Base-level incentive
Manufacturers that integrate more stages of production receive higher incentives.
💰 Financial Outlay Under the Scheme
The total financial outlay of the PLI scheme is:
PLI Tranche-1: ₹4,500 Crore
PLI Tranche-2: ₹19,500 Crore
Combined, India has committed ₹24,000+ Crore to support solar manufacturing.
More companies and manufacturing capacity were added in Tranche 2 due to growing demand.
🏭 Who Benefits From the PLI Scheme?
Manufacturers that produce the following in India:
Polysilicon
Wafers
Solar cells
Solar PV modules
Integrated manufacturing lines
Companies must meet minimum capacity thresholds and efficiency standards to receive incentives.
📈 Incentive Structure: How Companies Get Paid
The incentive is calculated based on:
✔ Performance – Quantity of modules manufactured
✔ Efficiency – Higher efficiency = Higher incentive
✔ Domestic Value Addition (DVA) – More Indian-made components = More incentives
Incentives are disbursed for 5 years, starting from the year of commercial production.
🚀 Impact of the PLI Scheme on India’s Solar Industry
✔ Massive growth in solar manufacturing
India’s solar module manufacturing capacity is expected to cross 65–75 GW by 2026.
✔ Reduced import dependency
Local production increases energy security and reduces reliance on Chinese imports.
✔ Job creation
The scheme is expected to generate thousands of direct and indirect jobs.
✔ Boost to exports
India aims to become a global exporter of solar modules and cells.
✔ Lower solar project costs
Domestic production stabilizes prices and reduces supply risks.
🧑💼 How PLI Helps Solar Installers, Developers & Consumers
Even if you’re not a manufacturer, PLI indirectly benefits:
For Solar Developers:
More reliable supply
Lower module costs
Better quality and performance
For Consumers:
Affordable rooftop solar
Better warranty and service
Higher efficiency modules
For Installers & EPC Companies:
Local sourcing
Faster logistics
Reduced project delays
🔧 Challenges & Future Scope
Although the PLI scheme is a game-changer, challenges remain:
Technology upgrades
Raw material availability
Maintaining cost competitiveness
However, with government support and private investment, India is on track to become a global solar manufacturing powerhouse.
🏁 Conclusion
The Production Linked Incentive (PLI) Scheme is transforming India’s solar manufacturing ecosystem. By offering lucrative incentives, promoting high-efficiency modules, and encouraging fully integrated manufacturing units, the PLI scheme is paving the way for a self-reliant and globally competitive solar industry.
With rising domestic capacity, Indian solar will become more affordable, accessible, and advanced than ever before.