Over the past two decades, both China and India have ramped up policy efforts to establish themselves in the growing global trade in goods related to the production and consumption of clean energy (CE). China’s initiatives have led to positions in the markets for solar, wind, rare earth minerals, and electric vehicles (EVs) that range from strong to dominant. Meanwhile, India’s efforts to establish domestic manufacturing capacity in the CE sector have met with more mixed success. For solar and wind components, China holds a share of at least 60% across all markets; India tops out at 12% in the global market for wind gearboxes.
However, a confluence of factors has led commentators to speculate on how this situation might change going forward. Geopolitical competition with China and a desire to diversify supply chains has led U.S. and its allies looking for alternative sources for CE-related goods. International investors are keen to find profitable projects and see India as potentially ripe for growth in this sector. Furthermore, India itself hopes to bolster the political appeal of its environmental policy by promoting an indigenous green manufacturing sector and become “self-reliant” in its clean energy transition.
Recommended citation:
Davidson, M., Fang, Z., Garg, T., Mariano, N., & Tong, L. (2025). The India-China Clean Energy Trade. UC San Diego 21st Century India Center.