As global energy shocks triggered by the US-Iran war exacerbate India’s vulnerability to external supply disruptions, the tensions between self-reliance and dependence on global supply chains come to the fore.
The war in West Asia has had a widespread impact on global supply chains, disrupting processes of manufacturing and trade. The volatility of the gas and energy supply from the region has exacerbated India’s deep reliance on imported fossil fuels to sustain its economy, especially in the realm of manufacturing. Fossil fuels make up 75% of India’s energy need, with the country importing 85-90% of its crude oil, 45-50% of its fossil gas and a large share of coal.
As a result of the conflict and the consequent blockade of the Strait of Hormuz, around 20% of the global energy supply has been disrupted. Manufacturing industries across India, including textiles, chemicals, aluminium, brewing and stainless steel, have faced major disruptions due to increased material and logistic expenses and increased processing costs. Energy shortages rippling across industrial activities have highlighted the significant energy-security risks of conflicts such as this one for an import-dependent economy such as India. Therefore, accelerating the domestic energy transition appears critical to decreasing dependence on imported fuels and reducing India’s vulnerability during global conflict. However, the realities of facilitating India’s energy transition gives rise to the question of whether it is a break from systems of dependence, or merely a shift to a new form of dependence.
Manufacturing Goes Green
India is pursuing the important goal of achieving Net Zero by 2070, making strides in the field of renewable energy. Government of India has prioritised the development of renewable energy capacity through sources such as nuclear, solar, wind, hydro, biogas and hydrogen, while advocating for green technologies and products such as EVs and Carbon Capture, Utilisation and Storage (CCUS). The government’s Aatmanirbhar Bharat initiative to boost domestic manufacturing has expanded into green energy, and Production Linked Incentive (PLI) schemes have been put in place with solar manufacturing receiving a large allocation.
Previously overlooked regions across states like Tamil Nadu, Gujarat, and Andhra Pradesh are emerging as key industrial centers, housing large-scale facilities producing solar panels, batteries, electrolysers, and other components critical to the green energy supply chain. This transformation is visible in a series of ambitious projects: the Tata Group’s massive solar PV plant in Tirunelveli, First Solar’s investment in an integrated manufacturing unit near Chennai, and large-scale developments by Adani Enterprises and Reliance Industries in Gujarat, spanning solar, hydrogen, and battery production. Green manufacturing therefore has been positioned as the foundation of India’s economic and strategic autonomy.
Autonomy vs Dependence
However, even as India pushes towards self-reliance through the shift to green energy, it remains caught in a web of dependency with China. China has a large influence over the global market for renewable energy, due to large-scale mass production structures within the country and the incorporation of improving technologies from Europe. Additionally, by gaining control over the critical minerals, including copper, lithium graphite and cobalt, that are essential for renewable energy, Chinese companies have established a strong foothold as leaders in the market.
The majority of solar components procured by India are sourced from China, including silicon semiconductor substrate wafers for the creation of solar cells, of which 16 million wafers were imported from China during 9 months of 2025. The import of cells which convert sunlight into electricity increased from ~600 million cells in 2022 to ~4.6 billion cells from January to September 2025, with dependence on China reaching nearly 90%. Moreover, India’s dependence on China for modules of completed solar panels remains at over 85%. China and India cooperate in the global renewable energy market, with India’s low-cost labour force combining with China’s mass-suppliable renewable energy components for Indian companies to achieve price competitiveness internationally.
Therefore, while India works towards self-reliance and domestic production in the field of renewable energy, the country still remains largely dependent on China for sourcing the materials used to make renewable energy components. What appears as a move toward autonomy in the wake of the war in Iran may, in fact, be a reconfiguration of dependence.
Path to Self-Reliance
If India’s push for self-reliance in green manufacturing is to move beyond rhetoric, it must extend across the entire value chain. This means investing not just in final assembly but in upstream capabilities like polysilicon and battery materials, securing access to critical minerals through strategic partnerships, and building indigenous technological capacity through sustained R&D.
At the same time, self-reliance cannot mean isolation. Diversifying trade relationships while strengthening domestic supply ecosystems, from large firms to MSMEs, will be key to reducing vulnerability. Stable, long-term policy signals and financial support for energy infrastructure are equally essential to support this transition. Ultimately, self-reliance in a globalised economy will depend less on cutting ties and more on building the capacity to navigate and reshape interdependence on more favorable terms.