Wind Industry Players Advocate for Phased Localisation Approach in Government Timeline

The wind energy sector in India is at a critical juncture as it strives to balance ambitious renewable energy targets with the practical challenges of domestic manufacturing. Industry players are urging the government to adopt a phased approach to localising key wind turbine components, citing concerns over a recent draft amendment by the Ministry of New and Renewable Energy (MNRE). This article delves into the rationale behind this call, the potential benefits of a gradual timeline, and the implications for India’s renewable energy landscape.

The Push for Localisation

India’s renewable energy sector, with a compounded annual growth rate of 15.51% over the past five years, has positioned the country as a key player in the global clean energy transition. Wind power, contributing significantly to this growth, currently boasts an installed capacity of approximately 44 GW, making India the world’s fourth-largest wind market. However, the sector faces a dependency on imported components such as permanent magnets, bearings, and converters, primarily sourced from China and Europe. To address this, the MNRE has proposed a draft amendment mandating rapid localisation of critical wind turbine parts, including blades, towers, gearboxes, and generators, to boost domestic manufacturing and reduce import reliance.

While the intent to enhance self-reliance under initiatives like “Make in India” and “Aatmanirbhar Bharat” is widely supported, the industry has raised alarms over the feasibility of an immediate mandate. The sudden shift could disrupt supply chains, increase costs, and deter foreign original equipment manufacturers (OEMs) from participating in the Indian market.

Industry Concerns and the Case for a Phased Approach

Industry leaders argue that a phased localisation strategy is essential to avoid bottlenecks and ensure sustainable growth. V Sriniwas Reddy, Executive Director of Synergy Green Industries, emphasizes that precision components like gearboxes and converters require not just capital expenditure (capex) but also technical partnerships and a skilled workforce. A blanket mandate without adequate preparation could stifle innovation and competitiveness, potentially undermining India’s goal of becoming the world’s third-largest wind market.

Francis Jayasury, Director-India at the Global Wind Energy Council (GWEC), echoes this sentiment, advocating for “smart localisation” over forced isolation. He suggests leveraging existing domestic capacity while collaborating globally for specialised technologies. An abrupt policy could lead to supply chain disruptions, increased project costs, and delays in meeting the 500 GW renewable energy target by 2030. Instead, a gradual timeline would allow manufacturers to scale up production, develop technical expertise, and establish a robust local vendor base.

Benefits of a Phased Localisation Strategy

A phased approach offers several advantages. Firstly, it provides manufacturers with the time needed to build infrastructure and train personnel, reducing the risk of quality compromises. For instance, developing larger-sized turbines (e.g., 5.3 MW) requires years to establish a reliable supply chain, as noted by Anil Jain of Refex Energy. Secondly, it encourages global partnerships, enabling technology transfer and access to advanced manufacturing techniques. This aligns with GWEC’s recommendation of incentive-based measures like research and development (R&D) funding and export-linked incentives to foster investor confidence.

Moreover, a gradual rollout mitigates the financial burden on developers. Vineet Mittal of Avaada Group warns that restricting imports could force the use of smaller, less efficient turbines, driving up costs for consumers. A phased policy, potentially applicable post-2028 as suggested by Mittal, would allow the industry to transition smoothly while maintaining competitiveness. This approach also supports the full utilisation of existing domestic capacity, a key principle highlighted by industry stakeholders.

Challenges and Mitigation Strategies

Despite the merits, implementing a phased localisation timeline is not without challenges. Subsidised imports and fragmented tariffs pose competitive threats to local manufacturers, as noted by Jayasury regarding his Chennai facility. Additionally, the absence of mandatory standards for components like anchor cages complicates quality assurance. To address these, the industry recommends clear harmonised system (HS) code classifications, Bureau of Indian Standards (BIS) certifications, and targeted support to counter import subsidies.

The government’s role is pivotal in providing training, R&D support, and infrastructure investment. Updating guidance on noise assessment (ETSU-R-97) and environmental impact, as seen in international models like the UK’s Onshore Wind Strategy, could further align policies with industry needs. A collaborative framework involving local planning authorities and statutory consultees will also ensure that localisation efforts do not hinder project timelines.

Regional and Global Context

India’s localisation push mirrors global trends where countries like Taiwan, South Africa, and Denmark have successfully built wind industries through strategic policies. The GWEC report highlights that flexible, market-friendly approaches—such as time-bound localisation and regional collaboration—yield better outcomes than rigid mandates. As global demand for wind energy surges, India’s ability to balance domestic growth with international integration will determine its standing in the renewable energy race.

A Balanced Path Forward

The wind industry’s call for a phased localisation approach reflects a pragmatic response to the MNRE’s ambitious directive. By allowing a gradual transition, India can strengthen its domestic manufacturing base, enhance global competitiveness, and meet its renewable energy goals without compromising project viability. The success of this strategy hinges on government-industry collaboration, clear timelines, and supportive policies. As the sector navigates this transformative phase, a well-executed localisation plan could position India as a global hub for wind turbine manufacturing, driving economic growth and sustainability for years to come.