India's PLI Winners Lean Heavily On Chinese Suppliers

New Delhi, Feb 8 (KNN) A significant number of winners in India's Production Linked Incentive (PLI) scheme have listed Chinese supply chain partners and service providers, according to a report by business standard.

This revelation raises questions about the country's dependency on Chinese vendors in key sectors, particularly in the renewable energy industry.

Leaders in the renewable energy sector, including Reliance New Energy Solar, Tata Power, ReNew Solar, Avaada Electro, and Waaree Energies, have prominently featured Chinese vendors as major suppliers in their PLI projects.

For instance, Reliance New Energy Solar listed all its 20 foreign vendors from China, while Waaree Energies, one of India's oldest solar equipment manufacturers, has all 17 of its supply chain partners from China.

The report highlights that even Indosol (Shridi Sai), a winner in the first tranche of solar PLI, has listed 65 out of 94 vendors as Chinese. Notably, Adani Mundra, the solar manufacturing division of Adani Group, has not yet submitted any names to the government.

Among other firms mentioned in the report, VSL Solar, AMPIN Solar, and Grew Energy stand out with more than 90 per cent of their vendors being from China.

Experts cited in the Business Standard report attribute this heavy reliance on Chinese suppliers to India's nascent solar module manufacturing capacity and the dominance of Chinese suppliers in the global supply chain for factory equipment.

India's solar power generation capacity heavily relies on China-made solar equipment, accounting for about 70 per cent of the total capacity.

In response to this dependency, the PLI scheme for solar aims to boost the domestic supply chain of solar power equipment and reduce reliance on imports.

The PLI scheme, announced by the government in 2021 for various sectors, aims to attract investments, promote cutting-edge technology, enhance efficiency, and make Indian companies globally competitive.

It seeks to bring all stakeholders together, fostering a sense of ownership and facilitating knowledge exchange to ensure successful implementation.

While the PLI scheme holds promise for India's industrial growth, the reliance on Chinese suppliers underscores the need for strategic efforts to develop indigenous manufacturing capabilities and diversify supply chains to mitigate risks associated with overdependence on a single country.

(KNN Bureau)