India’s Solar Leap: Financing a Mature Market

Solar PV is currently experiencing high growth in India and the country has become the third largest solar market globally. Driven by cost competitiveness, solar is now the preferred choice for new power plants by the federal and most state governments. Access to large amounts of capital is essential for the market to maintain its momentum. The report shows that the financing ecosystem in India is stepping up to meet the needs of the market.

Insights from the report



As the solar market has grown, local, commercially-driven capital has stepped up. This has tilted the financing landscape in favor of domestic Indian sources, which in 2016 contributed more than 85% of financing.



Indian solar market lenders are some of the most active financiers in the market with deep relationships with domestic industrial conglomerates and specialized solar financing teams. A number of Indian power sector majors have been the early equity investors and continue to lead in the market.



With over INR 210 billion (Euro 3 billion) of debt financing lent by Indian banks to solar projects just in 2016, solar has evolved from a fringe infrastructure asset class to a mainstream option for both domestic public and private sector banks.