The solar capacity addition in India fell by 48 per cent year-on-year to 1.9 GW in January-March period of 2023, according to Mercom India Research.

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The country had added 3.6 gigawatt (GW) of solar capacity during the same period in 2022, the research firm said in its latest report.

"India added 1.9 GW of solar capacity in the first quarter of calendar year 2023, a 48 per cent decrease year-over-year (YoY) compared to the 3.6 GW added in Q1 2022," the report titled 'Q1 2023 India Solar Market Update' said.

On a quarter-on-quarter (q-o-q) basis, the installations were 30 per cent lower compared to the 2.7 GW solar capacity installed in October-December period or fourth quarter in 2022.

Out of 1.9 GW, large-scale solar projects accounted for 74 per cent of installations, with rooftop solar making up an additional 26 per cent.

India's cumulative installed solar capacity currently stands at 64.5 GW. As of March 2023, the country's utility-scale project development pipeline stood at 58 GW, with an additional 58 GW of projects tendered awaiting auction.

India's solar industry passed an important milestone in 2022, setting a new record with 13 GW of capacity added. However, in 2023 the additions are expected to be lower as commissioning deadlines for several projects have been moved to next year. Besides, a number of projects are facing delays due to land and transmission issues, Mercom India said.

"The market is re-calibrating following the ALMM decision by the government. Project extensions, GIB, and infrastructure issues point to a softer year than predicted.

"On a positive note, module prices are trending in the right direction, and project costs declined for the first time after rising for ten consecutive quarters, bringing much needed relief to the solar industry," Raj Prabhu, CEO of Mercom Capital Group, said.

The government earlier extended the ALMM by one year till March 2024 amid industry raising concerns over raw material availability and supply chain.

The Approved List of Models and Manufacturers (ALMM) was introduced to boost domestic manufacturing.