India's installed solar power capacity hit 150.26 GW by March 31, 2026, thanks to an impressive addition of 44.61 GW during FY2026. That's way more than the government's goal of 34 GW and even beats last year's increase of 23.83 GW. To put that into perspective, annual solar power installations have skyrocketed from just 3.13 GW back in FY2016.

In FY2026, distributed renewable energy really stepped up, adding 16.3 GW, which is nearly 36% of all new solar stuff. Projects set up with power purchase agreements made up 34%, and commercial and industrial segments threw in 30%.

India is now right behind China and the US when you look at how much solar power is cranked out each year. And hey, in terms of yearly installs, India might be number one by the time 2026 wraps up.

Still, the majority of solar activity happens in a handful of states. Rajasthan and Gujarat are clear leaders here. Maharashtra is on a roll too, climbing from eighth place to snag the third spot over the last ten years. The same goes for Karnataka, which isn't trailing far behind either.

Rapid expansion in manufacturing has led to excess capacity, too. In 2025, India added 119 gigawatts of solar module manufacturing capacity and over 9 gigawatts of cell manufacturing capacity, bringing the total module capacity to roughly 210 gigawatts.

With annual domestic demand sitting at 40-45 gigawatts, this means capacity utilization dropped to about 40%. That's a big fall from the 70+% recorded in fiscal year 2023.

Moreover, almost 30 GW of manufacturing still uses MonoPERC tech, whereas new investments favor TOPCon. Plus, India's solar PV exports to the US plunged from $1.97 billion to $1.12 billion between fiscal years 2024 and 2025. This nosedive happened after US tariffs on solar imports skyrocketed to over 200% starting in April 2026.

During that period, from April 2025 to February 2026, India's cell imports surged to $2.72 billion, up from $1.44 billion in the previous year. This spike in imports came before domestic sourcing rules kicked in for solar cells in June 2026. Despite this bump, China's share of India's solar cell imports slipped from 83% to 65% within a year, but they remain the top supplier.

In 2025, foreign direct investment in India's solar sector hit almost $2.37 billion, which made up over 4% of all FDI in India and roughly 76% of investments in unconventional energy areas. 

India aims for 500 GW of non-fossil fuel power by 2030. Experts think solar capacity will be between 280 and 300 GW by then.