India’s solar manufacturing capacity is expected to cross 125 GW by 2025, more than three times the current domestic demand of around 40 GW, according to Wood Mackenzie. The surge has been driven largely by the government’s Production Linked Incentive (PLI) scheme, which has accelerated the setting up of large-scale factories across the country.
However, this rapid expansion comes with growing risks. The report highlights a potential inventory surplus of nearly 29 GW, as domestic consumption remains limited and exports to the US have dropped 52% in the first half of 2025 due to new reciprocal tariffs.
Several Indian manufacturers have paused their international expansion and are now refocusing on the local market. But while this overcapacity might look like a setback for big producers, it actually opens a window for startups.
Smaller players can build solutions around deployment, storage, recycling, and financing areas that remain underdeveloped despite the scale-up in manufacturing.
Startups can help bridge the last-mile gap by creating smart distribution networks, solar leasing models, panel reuse systems, and AI-based demand forecasting tools. Others can focus on energy analytics, rooftop management, or community solar solutions that put this excess capacity to productive use.
Also Read: The Truth About Influencer Marketing: Why Some Brands Win Big and Others Fail?
