India is at the cutting edge of the renewable energy revolution. With so much sunlight pouring into the country and the government making ambitious plans, it is poised to become a leader in the world of solar energy. But can India become a leader in the solar revolution? Let’s take a look.
Recent Developments
Installed Solar Capacity
India has officially broken the 140 GW installed solar capacity barrier (as of January 2026). Solar energy continues to be the fastest-growing category, with a record single-year addition of close to 35 GW in the 2025-26 fiscal year. India is now ranked 3rd in the world in solar energy production.
Wind Energy
India continues to be the 4th largest in the world in installed wind energy capacity. The total installed capacity has touched around 54.6 GW (up from the earlier 34 GW mark), thanks to a massive revival in the sector and a record single-year installation of over 6 GW in 2025.
Overall Renewable Energy
The cumulative installed capacity of renewable energy in India (including large hydro) has touched the 263 GW mark, making it the 4th largest in the world. The pipeline for future growth is even more ambitious, with over 232 GW of capacity currently under implementation or tendered, putting India firmly on track to achieve its 500 GW target by 2030.
Investment
The sector has seen unprecedented levels of investment. Since 2020, Foreign Direct Investment (FDI) in non-conventional energy alone has crossed $23 billion, with total domestic and foreign investment touching $100 billion in the past five years.
Job Creation
The renewable energy industry currently provides 1.3 million jobs. Although the industry is growing at a fast pace, the “10 million jobs” mark is the target for 2030, and the “green economy” is expected to provide more than 48 million jobs by 2047.
Government Initiatives in Solar Energy Sector
To realise the target, the government has initiated numerous policy measures, such as:
- PM-KUSUM (Kisan Urja Suraksha evam Utthaan Mahabhiyan) Scheme
- The scheme has been extended till March 2026 with a new target of adding 34.8 GW of solar power.
- Solar Pumps: The target for standalone and grid-connected solar pumps (Components B and C) has been raised to 49 lakh units.
- Achievements: As of January 2026, more than 10 lakh solar pumps have been installed/solarized.
- Funding: The Union Budget 2026-27 has almost doubled the budgetary support for this scheme to ₹5,000 crore to promote the replacement of diesel pumps.
PM Surya Ghar: Muft Bijli Yojana (Successor to SRISTI)
Although the Grid Connected Rooftop Solar (RTS) scheme is still on, it has been largely expanded under the PM Surya Ghar: Muft Bijli Yojana (launched in 2024).
- Target: Plans to deliver 300 units of free electricity to 1 crore households by 2027.
- Subsidies: Up to ₹78,000 for residential consumers for systems above 3 kW.
- Progress: As of early 2026, about 24.3 lakh households have already benefited from this scheme, thanks to a massive budgetary outlay of ₹22,000 crore.
ISTS (Inter-State Transmission System) Charges
The full waiver for solar and wind projects is valid until June 30, 2025. A gradual transition has been introduced:
- Current Rate: Projects operational between July 2025 and June 2026 will get a 75% waiver on transmission charges.
- Future Outlook: This will gradually decrease to 50% in 2026-27 and 25% in 2027-28.
- Exceptions: The 100% waiver is still applicable for Green Hydrogen projects (valid until 2033) and Battery Energy Storage Systems (BESS) to promote grid stability.
Solar-Wind Hybrid & Storage Policy
The government has moved on to adopt “Round-the-Clock” (RTC) power.
- BESS Integration: The Budget of 2026 witnessed a 9 times rise in Viability Gap Funding (VGF) for Battery Energy Storage Systems, ensuring that hybrid parks can provide power even after sunset.
- Hybrid Parks: Large projects such as the 30 GW Khavda Renewable Energy Park in Gujarat are now functional in phases, integrating solar and wind energy with state-of-the-art storage.
Establishment of Solar Parks
The goal is to achieve 40 GW in the country.
- Progress: Currently in 2026, 55 solar parks have been approved in 12 states with a combined capacity of around 39,958 MW.
International Solar Alliance (ISA)
Membership and Expansion
From a coalition of 121 “sunshine countries” to a global platform, the ISA has come a long way.
- Global Reach: With a 2020 amendment, membership is now available to all UN member states.
- Current Membership: The ISA currently has more than 125 member and signatory countries. Most recently, Moldova became the 107th member to ratify the framework (August 2025).
- Geopolitical Update: In January 2026, the United States announced its intention to withdraw from the coalition; however, India and other member countries have reiterated their commitment to the ISA’s climate objectives.
Mission: The “Towards 1000” Strategy
The mission has been quantified in a comprehensive 2030 strategy called the “Towards 1000” strategy:
- Capacity: Develop 1,000 GW of solar power capacity worldwide.
- Investment: Attract $1,000 billion (USD 1 trillion) of solar investment.
- Access: Deliver clean energy access to 1,000 million people.
- Environment: Reduce 1,000 million tonnes of CO2 emissions every year.
Leadership and New Initiatives
- Presidency: India and France were re-elected as President and Co-President for the term 2024-2026.
- AI for Energy: In February 2026, the ISA launched the Global Mission on AI for Energy. This new mission is centered on the application of Artificial Intelligence to decentralized solar energy and energy efficiency in the member states.
- One Sun One World One Grid (OSOWOG): This new initiative, led by India, is a fundamental part of the ISA’s vision to develop a global interconnected green grid to transport solar energy across time zones.
Headquarters
The ISA continues to be headquartered in Gurugram, Haryana, India. The ISA continues to be the first treaty-based international intergovernmental organization to be headquartered in India, a global hub for the “Global South” to lead the global energy transition.
Advantages for India
Solar Energy Potential
- With around 300 days of clear and sunny weather in a year, the estimated incidence of solar energy on the landmass of India is approximately 5,000 trillion kilowatt-hours (kWh) per year (or 5 EWh/yr).
- The solar energy potential for a year is still much higher than the potential energy of all fossil fuel energy resources in India.
Generation Efficiency
- The average generation capacity of solar power plants per day has been improved to around 0.30 kWh per $m^2$ of land used (compared to the previous 0.20 kWh level).
- This is equivalent to 1,400-1,800 hours of peak (rated) capacity operation per year using the latest technology.
Leading Solar States
- Rajasthan is currently the leading solar state in India, having achieved over 20,000 MW (20 GW) of installed solar capacity as of 2025. It is home to the Bhadla Solar Park, which is still one of the largest solar parks in the world.
- Gujarat has moved to the second spot (approx. 14 GW), mainly due to a huge increase in residential rooftop solar installations.
- Karnataka, which was the leading state in 2017-18, is still a strong contender but is currently third with over 9,500 MW of installed solar capacity, thanks to the huge Pavagada Solar Park.
- The Cell Gap: Though the manufacturing of solar modules is going strong, there is a gap in solar cell manufacturing (expected to touch 55 GW by 2027) and even more so in polysilicon and wafers.
- Policy Push: The PLI Scheme (Tranches I & II) has already committed over ₹52,000 crore of investments to fill this gap, although reliance on imported raw materials such as silver paste and specialty glass is still causing price volatility.
Challenges Ahead
Manufacturing Gap & Upstream Integration
- Capacity Surge: India’s solar module manufacturing capacity is expected to touch 100 GW by the end of 2026, a huge increase from previous years.
- The Cell Gap: Though the manufacturing of solar modules is going strong, there is a gap in solar cell manufacturing (expected to touch 55 GW by 2027) and even more so in polysilicon and wafers.
- Policy Push: The PLI Scheme (Tranches I & II) has already committed over ₹52,000 crore of investments to fill this gap, although reliance on imported raw materials such as silver paste and specialty glass is still causing price volatility
Implementation & “Stranded” Capacity
- Auction Delays: Large-scale auctioning has been less active in 2025-26 due to a lack of interest from state DISCOMs (Distribution Companies) in signing new solar PPAs, resulting in a 45% decline in tender announcements.
- The PPA Bottleneck: As of early 2026, approximately 40-45 GW of successfully tendered solar projects are now “stranded” or delayed because Power Purchase Agreements (PPAs) or Power Sale Agreements (PSAs) have not been executed yet.
- Infrastructure Bottlenecks: Land acquisition is still a challenge, especially in the state of Rajasthan because of Great Indian Bustard (GIB) conservation areas. Also, delivery times for essential high-voltage transmission infrastructure such as transformers have increased to almost 20 months.
Energy Demand vs. Grid Stability
- Peak Demand: India achieved a record peak power demand of more than 250 GW in 2025/26 successfully. But the sharp increase in solar power has resulted in “surplus” generation during peak sunlight hours, resulting in the possibility of curtailment.
- The Storage Pivot: The need for a huge transition from “solar-only” to Solar + Storage (BESS) and Hybrid projects has arisen to achieve “Round-the-Clock” (RTC) power.
- The Net-Zero Gap: Even with more than 263 GW of renewable energy capacity, renewables account for only 5% to 8% of total final energy consumption in India, which reveals the huge transition required.
Conclusion
The Indian solar story is quite inspiring, with robust government support, global cooperation, and vast natural resources. As of 2026, the country has reached a historic achievement by meeting its COP26 pledge—securing 50% of its electricity capacity from non-fossil fuel sources—five years before the target date of 2030.
India has surpassed Japan to become the 3rd largest solar power producer globally and is set to surpass the United States to become the 2nd largest solar market by the end of this year. Although there are still hurdles in deep upstream manufacturing (such as polysilicon and wafers) and grid transmission, the trend indicates that India is no longer a part of the solar revolution but is actually leading it. With the successful execution of the PM Surya Ghar mission and a huge domestic module manufacturing base of 100 GW+, India is on track to meet its final target of 500 GW of renewable energy by 2030.
“Solar energy isn’t just a substitute for electricity—it’s India’s ticket to leading the world in renewable power. By raising awareness and normalizing its use, we can harness the sun’s boundless gift to light up our future.”
Shidulla Laskar