Government Considers PLI Scheme to Boost Polysilicon Manufacturing

In August 2026, the Indian government prepared a Production-Linked Incentive (PLI) scheme for polysilicon manufacturing as it seeks to strengthen the domestic solar manufacturing value chain and reduce the country’s dependence on imports.

India’s existing PLI scheme for solar PV modules covers both upstream and downstream segments. The upstream segment includes polysilicon, ingots, and wafers, while the downstream segment covers aspects like solar cells and modules. However, implementation and investment in upstream manufacturing have been progressing more slowly, particularly in areas such as polysilicon refining and ingot and wafer production. This proposed scheme is dedicated support for polysilicon could therefore address a critical gap in India’s solar manufacturing ecosystem.

A dedicated PLI scheme for polysilicon could also potentially encourage large-scale investments in refining and processing capacity. At the same time, it could strengthen the upstream segment of India’s solar PV industry and reduce exposure to global supply-chain disruptions. More importantly, building domestic expertise in polysilicon refining could create synergies between India’s renewable energy and semiconductor manufacturing ambitions. As reported by indianexpress.com, as India continues to expand its solar power capacity, developing a reliable domestic supply of critical raw materials will become increasingly important. The proposed polysilicon PLI scheme could therefore become a key step towards creating a more integrated, competitive, and self-reliant clean-energy manufacturing ecosystem.

The proposed PLI framework is aimed at attracting investment into this strategically important segment and creating a stronger domestic supply base for the solar industry. As a result, the initiative could help reduce import dependence while supporting the government’s broader efforts to develop an integrated solar manufacturing ecosystem.

Impact on the Chemicals Market

Polysilicon occupies the upstream end of the solar PV manufacturing value chain. Manufacturers first process polysilicon into ingots, which are then sliced into wafers. These wafers are then used to manufacture solar cells, which are finally assembled into solar PV modules or panels. Developing domestic capabilities across these stages can help the country to establish a more integrated and resilient solar manufacturing industry.

The government is also considering polysilicon manufacturing as an independent industrial sector rather than treating it solely as one component of the solar manufacturing value chain. This approach reflects the nature of polysilicon production, which involves significant chemical processing and refining. Furthermore, developing domestic polysilicon capacity could help create capabilities that extend beyond the solar industry. Moreover, higher-purity polysilicon has potential applications in the semiconductor industry, making domestic production strategically relevant to India’s broader ambitions in advanced manufacturing and electronics.

Impact on the Polysilicon Market

The global polysilicon market size is valued at USD 14.49 billion in 2025 and is predicted to increase from USD 16.29 billion in 2026 to approximately USD 45.90 billion by 2035, expanding at a CAGR of 12.22% from 2026 to 2035.

According to Precedence Research, the solar photovoltaic (PV) industry's explosive growth is the main driver of the polysilicon market. The need for polysilicon, a substance essential to the production of solar cells, is growing along with the market for solar energy. The market for electric vehicles is expanding, which therefore raises the need for polysilicon. Polysilicon is used in solar cells and other electrical parts of electric vehicles (EVs), and as the auto industry shifts to electric vehicles, there is a growing need for polysilicon in EVs for a variety of uses. The production of energy from renewable sources is the main emphasis of the global economy. Cleaner alternative energy sources are replacing petroleum derivatives based on carbon due to climate and environmental concerns. Concentrating on renewable energy is an ideal opportunity for the polysilicon market to expand.

The artificial intelligence increases the efficiency, quality, and sustainability of polysilicon manufacturing. The neural network analysis of AI optimizes the reactor control of Siemens and FBR reactors. It enhances high-purity yield and minimizes the use of energy. Predictive maintenance reduces unplanned downtimes and increases the equipment's life. Computer vision enhances detection accuracy. AI is also enhancing energy management and supply chain visibility to enhance resilience and cost-effectiveness in the whole operation.

Impact on the Solar Photovoltaic (PV) Market

The global solar photovoltaic (PV) market size was estimated at USD 196.94 billion in 2025 and is projected to increase from USD 216.04 billion in 2026 to approximately USD 484.85 billion by 2035, growing at a CAGR of 9.43% from 2026 to 2035.

According to Precedence Research, the expansion of gigawatt-scale manufacturing and a rapid shift toward renewable energy are driving the market. Government incentives and technological advancements are also contributing to market growth. Market expansion is being accelerated in both developed and emerging economies by growing investments in distributed rooftop installations, utility-scale solar projects, and energy transition programs. The performance and uptake of photovoltaic systems are being further improved by technological developments in smart grid infrastructure, energy storage integration, and high-efficiency solar cells. Furthermore, governments, companies, and consumers are being encouraged to invest in solar energy solutions due to growing concerns about carbon emissions, energy security, and climate change. As a result, solar PV is one of the renewable energy industry's fastest-growing segments. The demand for eco-friendly energy is encouraging clean energy developers to promote the market.

Manufacturers are improving panel efficiency and reducing production emissions to meet sustainability goals. The integration of battery storage with solar systems is creating cleaner and more reliable renewable energy infrastructure. Startup companies are developing AI-based energy management platforms and smart inverters to improve affordability and efficiency.