The global energy transition is gathering pace and India is playing a key role in the renewable energy transition. With the government seeking to achieve 500 GW of installed non-fossil fuel-based energy by 2030, the Solar Energy sector in India is leading the charge toward this goal in the renewable energy sector. According to the latest report by the IMARC Group, the India Solar Energy Market is expected to witness strong growth in the coming years.
The Solar Market in India is expected to reach approximately USD 30.03 billion in 2025, growing at 37.82% CAGR during the period 2026-2034 to reach a market size of approximately USD 538.91 billion by 2034. In this blog, we look at the key drivers of the extraordinary growth expected, the technology to drive it and the demand across the different regions.
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The Structural Shift: Policy Meets Innovation
This growth can be mostly attributed to a synergistic combination of state and technological push. The Government of India has made energy independence a national goal and undertaken initiatives to fundamentally de-risk investments in the energy sector.
One of the major achievements is the launch of the PM Surya Ghar: Muft Bijli Yojana scheme which transformed the residential segment with over 19 lakh rooftop installations in 2025 alone and almost 7.7 lakh households with zero electricity bills. This democratization of solar through going from utility-scale solar parks to individual rooftops is creating a decentralized energy economy.
On the supply side, the PLI scheme has led to an increase in domestic manufacturing of high efficiency solar modules, thereby considerably reducing India’s historical dependency on imported solar cells and modules and improving supply chain resilience.
Emerging Trends: Beyond Traditional Solar
But the market is rapidly maturing, and the IMARC Group report identifies a number of advanced trends to watch.
- Battery Energy Storage Systems (BESS): The rapid growth of new markets for solar-plus-storage hybrid systems is being driven by the instability of the electric grid following the solar scale-up. New systems cover the intermittency of solar generation and provide RTC (Round-the-Clock) renewable energy supply, which is often necessary for industrial customers.
- Floating & Agrivoltaic Solar: Developers are now looking at floating solar and high-efficiency generating resources due to the land acquisition bottlenecks in some regions. Solarfarming, or agrivoltaics, is also gaining popularity with respect to the dual-use of land for water and agricultural purposes.
- Corporate Decarbonization: Due to corporate ESG commitments and the economics of lower tariffs compared to the grid, the Commercial and Industrial (C&I) vertical is quickly adopting solar technology. There is now a record amount of Open Access and Captive Power structures in the country.
Market Segmentation: Where is the Value?
To understand the market’s trajectory, it is essential to look at its granular segments:
By Deployment:
Due to an economically viable model and the availability of land in Rajasthan and Gujarat, ground-mounted systems are expected to continue dominating the solar market and account for over 58% of the total market share by 2025.
However, the Rooftop segment continues to grow, due to residential incentives and net metering.
By Region:
West India, particularly the Indian states of Gujarat and Maharashtra, is now a strong solar module manufacturing and project development hub because of pro-solar policies.
North India, especially Rajasthan where desert areas accommodate several large solar parks, is the second-largest region.
South India (Tamil Nadu, Karnataka and Telangana) is an important contributor to the country’s C&I industry.
Why This Matters for Investors
Given the rapidly growing solar opportunity in India, there are numerous wealth creation opportunities along the solar value chain (module manufacturers, EPC contractors, project developers and project financiers). With falling PV module prices and improved LCOE metrics, the cost of solar has become cheaper than thermal [power] in several situations across India.
These substantial investments in the renewable energy (RE) sector are Jindal Group’s 150 MW RTC RE PPA and Mahindra Susten’s commissioning of 560 MW of utility-scale solar power projects.
Conclusion
It is in the decade that the future of energy in India will be defined, as the Indian solar market is projected to cross half a trillion dollars by 2034. Solar will no longer be an alternative energy source. In this article we summarize the key drivers of the Indian solar market including regulatory and technological developments of interest to companies and investors.
According to a report by The IMARC Group, the report provides a thorough overview of the industry’s current market trends, competitive landscape, investment outlook, and growth opportunities.
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