The Indian government, through the Ministry of New and Renewable Energy (MNRE), has long supported domestic solar PV cell and module manufacturers, mainly through the Domestic Content Requirement (DCR) policy permitted by the World Trade Organization (WTO). The policy aims to boost the growth of the domestic solar industry and reduce dependence on imports.

To ensure the integrity of this policy and prevent its misuse, the MNRE issued an Office Memorandum (OM) on February 20, 2018. Under the OM, strict action will be taken against any non-compliance under the MNRE scheme or scheme in the event that a DCR is enforced in a manner consistent with WTO regulations on solar photovoltaic power generation projects.

These actions include instituting criminal proceedings under the relevant provisions of the Indian Penal Code, such as IPC 420, which involves fraud. In addition, developers found to be in breach may face blacklisting for up to 10 years, forfeiture of the relevant bank guarantees, disciplinary action against the Central Public Sector Unit (CPSU) or the responsible official of the state government, and any other appropriate measures.

However, concerns have resurfaced that the supply of solar PV modules under the MNRE scheme or the scheme may not be fully compliant with the DCR requirements set out in the respective scheme or the scheme. In response, the MNRE reiterated the importance of strict compliance with the DCR provisions under its plan or program. It warned that any violations would result in the same harsh action as outlined in previous memos.

The reaffirmation of these guidelines underscores the government's commitment to maintaining the integrity of solar policy and promoting the development of the domestic solar industry. By ensuring compliance with DCR regulations, the government aims to foster a competitive environment that supports local manufacturers while advancing India's renewable energy targets.