US Proposes Heavy Countervailing Duty on Indian Solar Cells, Jeopardizing Key Export Market
The United States Commerce Department has delivered a severe blow to India's solar export industry by proposing a preliminary countervailing duty of 125.9% on crystalline silicon photovoltaic cells imported from India. This action, citing alleged subsidies, threatens to undermine the cost advantage that Indian suppliers have historically held in the critical US market.
Massive Impact on India's Solar Export Economy
The preliminary finding specifically targets shipments to the United States, which astonishingly absorbs more than 95% of India's total solar cell and module exports. This proposed duty is projected to effectively eliminate the competitive pricing edge that Indian modules have maintained over US-manufactured alternatives, which themselves rely heavily on imported cells for production.
Major Indian exporters facing significant exposure include industry leaders such as Waree Energies, Vikram Solar, Premier Energies, Mundra Solar Energy, and Mundra Solar PV. According to Sehul Bhatt, director at Crisil Intelligence, "Between April 2023 and November 2025, India exported solar cells and modules worth approximately Rs 34,000 crore to the United States."
Potential Commercial Unviability and Market Contraction
Bhatt further elaborated that modules from India could become at least 30% more expensive compared with US-made alternatives, potentially rendering them commercially unviable for American buyers. This assessment is corroborated by trade research body GTRI, which reported that India exported solar panels worth $1.2 billion to the US, representing an 18% decline from 2024 levels.
GTRI provided a stark illustration: "At this proposed duty rate, a $100 solar panel could land in the United States at about $226, making numerous existing contracts commercially unsustainable." The organization noted that other Southeast Asian nations including Vietnam, Thailand, Malaysia, and Cambodia already face substantial countervailing duties, suggesting a broader pattern of US trade policy in the renewable energy sector.
Industry Response and Strategic Adaptations
Despite the concerning outlook, some industry representatives maintain a cautiously optimistic stance. Abhishek Pareek, group head of finance at Waaree Energies, indicated that the matter remains under formal review and the company does not anticipate a material impact on its ability to service its existing US order book. "We are proactively expanding our local manufacturing footprint within the United States and diversifying our global supply chain to mitigate potential disruptions," Pareek stated.
Timeline and Future Uncertainty
The final determination on duty rates is not expected until July 2026, creating a prolonged period of uncertainty for bilateral solar trade. Until that conclusive ruling, trade flows between India and the United States in the photovoltaic sector are likely to remain volatile and subject to significant market fluctuations. This development represents a critical juncture for India's renewable energy export strategy and its positioning within the global green technology supply chain.
