Solar financing: Renewable energy ministry issues clarification; says no lender advisory was issued to banks

The Ministry of New and Renewable Energy (MNRE) on Sunday dismissed reports suggesting it had asked lenders to halt financing for renewable energy projects, saying no such advisory has been issued to financial institutions, PTI reported.In a statement, the ministry said it has not directed banks or other lenders to stop extending loans to renewable power projects or to renewable energy equipment manufacturing facilities. “It is hereby clarified that MNRE has not issued any advisory to financial institutions for stopping lending to either renewable energy power projects or to renewable energy equipment manufacturing facilities,” it said.The clarification comes amid media reports claiming that the ministry had cautioned lenders against fresh financing due to concerns around overcapacity in the sector.MNRE said it has only shared information on the current status of domestic manufacturing capacity in the solar photovoltaic (PV) segment with the Department of Financial Services and non-banking financial companies such as PFC, REC and IREDA. This, it said, is intended to help financial institutions take a calibrated and well-informed view while evaluating proposals for financing solar PV manufacturing facilities.

The ministry reiterated that the government remains committed to making India self-reliant in solar PV manufacturing and positioning the country as a significant player in the global value chain. This push is being supported through initiatives such as the production-linked incentive (PLI) scheme for high-efficiency solar PV modules and measures aimed at providing a level-playing field for domestic manufacturers.These interventions have led to a sharp expansion in solar module manufacturing capacity, which has risen from 2.3 GW in 2014 to around 122 GW enlisted in MNRE’s Approved List of Models and Manufacturers (ALMM), the ministry said.MNRE added that it will continue engaging with stakeholders to ensure India’s renewable energy transition remains inclusive, competitive and future-ready.India, the statement noted, has already achieved 50 per cent of its installed electricity capacity from non-fossil fuel sources, five years ahead of the target set under its nationally determined contributions to the Paris Agreement. As of October 31, 2025, installed non-fossil capacity stood at about 259 GW, with 31.2 GW added so far in the current financial year.