Why Indian module manufacturers are not able to compete with global competition?

It is not only the Indian module manufacturers but even American and european module manufacturers are finding it difficult to compete with Chinese module manufacturers in terms of the price as well as quality considerations. In order to protect Indian module manufacturers government of India has also introduced 40% basic custom duty on solar modules and 25% on solar cells from April 20 22. India has imported about 11.93 GW of solar modules during last six months from China which shows that Chinese vendors are still the preferred vendors for Indian Solar developers. Government has also introduced a list of approved module manufacturers (ALMM) and we are yet to see the effectiveness of this list which forces the solar power developers to use domestic modules otherwise they will not be given the benefits such as netmetering approval in Rooftop projects.
Here are the three reasons why we are not able to compete with China to meet the global demand as well as domestic demand of solar modules.
1. China considers solar module manufacturing as its strategic industry and has extended support to the Solar Module manufacturers to the tune of $47 billion which is significant and has led Chinese module manufacturers to create significant job opportunities as well as economy of scale in the country. adopting the similar incentives to the Indian manufacturers Nirmala Sitharaman in the recent budget has announced one 195 billion Indian rupees support which is about $2.62 billion, which is too little and too late to the module manufacturers.
2. The domestic demand in China is of the order of 50 GW per year. During last year 2021 China has installed over 53 GW of solar energy as compare to Indian installations of the order of 10 GW. While India also have aggressive target of 100GW by 2022, there are various bottlenecks due to which India will fall short of this target and due to lack of domestic demand and 80% of the domestic demand of solar modules is being fulfilled by China imported models, Indian module manufacturers find it difficult to compete with Chinese suppliers due to lack of domestic demand. India has module manufacturing capacity of the order of 15 GW and 3 GW of solar cell manufacturing while China has about 500 GW of module manufacturing which is about 30 times than Indian capacity. The solar cell manufacturing capacity in China is of the order of 170 GW. The economy of scale makes it unsustainable not only to the Indian manufacturers but European as well as American manufacturers to compete with Chinese module manufacturers. The companies such as Sun Edison First solar and Sunpower which have been leading the global market a decade ago are now finding highly difficult to compete with Chinese manufacturers.

3. With large manufacturing base China also commands technology leadership in solar cell and module manufacturing. China holds many of the words patents in solar cells and modules which makes it commanding the technology as compare to US and European manufacturers.

China’s approach to boost solar manufacturing is so aggressive that it is not only important for Indian government but also other countries, to protect their domestic manufacturing setups and support the manufacturers before they died down.