ndia’s target of 500 GW of non-fossil fuel capacity by 2030 has turned solar energy into a national priority. As the Union Budget 2026–27 approaches, the question is no longer whether solar will lead India’s clean energy transition, but whether policy can decisively shift from scale to strength.
Recent government actions suggest that intent is clear. The next budget has an opportunity to convert that intent into long-term resilience: Stronger domestic manufacturing, faster rooftop adoption and a grid ready for the future.
Building a Domestic Solar Powerhouse
Few sectors illustrate India’s industrial momentum as clearly as solar manufacturing. Production-linked incentive (PLI) programs and the Approved List of Models and Manufacturers (ALMM) have dramatically reduced dependence on imports while catalysing domestic capacity. Solar PV module manufacturing capacity grew from around 38 GW in March 2024 to over 100 GW by August 2025, driven largely by these policies. Investments in modules, cells, and other components have been stimulated by budget support, which has helping manufacturers achieve greater backward integration.
What the industry now looks for is continuity. Extending and refining PLI schemes, improving access to low cost capital, and rationalising customs duties can stabilise supply chains and shield manufacturers from global price volatility. Done right, this would support climate goals while further positioning India as a solar manufacturing hub.
Rooftop Solar: From Scheme to Movement
If utility-scale solar demonstrates India’s strength, rooftop solar shows its social impact. Under PM Surya Ghar: Muft Bijli Yojana, nearly 24 lakh (2.39 million) households had installed rooftop systems by December 2025 – a major milestone toward the one-crore target. The scheme has already delivered about 7 GW of installed capacity, supported by over ₹13,000 crore in subsidies.
For households, the impact is tangible. Annual electricity savings of Rs15,000–18,000 are not abstract climate benefits but real income relief. At the same time, rooftop solar is creating jobs in installation, operations and maintenance, while building local awareness of clean energy.
To sustain momentum, Union Budget 26-27 can play a catalytic role by simplifying approvals, improving net-metering policies and ensuring adequate funding as demand scales. Faster adoption also eases long-term pressure on power distribution companies.
From Capacity to Capability: Storage and the Grid
With India’s installed solar capacity nearing 135 GW, the challenge is evolving. Adding panels is no longer enough; integrating them efficiently is now the priority. High-efficiency modules, digital monitoring and AI-based performance tracking are becoming essential to maximise output and reduce operating costs. Budget support for research and development can help domestic players stay competitive.
Equally critical is storage and grid readiness. Investments in battery storage, green energy corridors and flexible grids will determine how effectively India can manage intermittency. Faster clearances for power purchase agreements and clearer market signals for storage can significantly improve system reliability.
Financing People and the Transition
Long-term solar growth depends on more than infrastructure. Affordable financing through green bonds, viability gap funding and refinancing options can lower project costs and unlock new markets. Expectations from Budget 2026-27 include higher allocations for solar parks and clearer policies on land use and approvals. At the same time, the sector’s expansion demands a skilled workforce. Training workers across manufacturing, installation and maintenance can ensure India’s clean energy transition also becomes an employment engine.
A Budget that Locks in Momentum
Budget 2026–27 is not about starting from scratch. It’s about reinforcing what already works — and fixing what could slow India down.
With steady funding, policy clarity and an emphasis on manufacturing, rooftops and grid readiness, India can strengthen its solar ecosystem, advance self-reliance and stay on firmly on track toward its climate commitments. |
