India and the U.S. are working to unlock $1 billion in multilateral finance through the International Bank for Reconstruction and Development (IBRD) to support supply-side manufacturing capacity focusing on solar, wind, battery, energy grid systems, high-efficiency air conditioners, and ceiling fan supply chains.

In a joint statement issued by the two countries during Prime Minister Narendra Modi’s visit to the U.S., the countries unveiled a roadmap to build safe and secure global clean energy supply chains and expand bilateral technical, financial, and policy support to expand complementary capacities for clean energy technologies.

The U.S. and Indian governments also pledged to work with industry leaders to identify near-term investment opportunities to expand manufacturing capacity for specific clean energy supply chain segments with a focus on the following:

• Solar wafers and wafer manufacturing equipment and next-generation solar cells
• Wind turbine nacelle components
• Power transmission line components, including conductors, cabling, transformers, and next-generation technologies
• Energy storage components, including batteries
• Battery packs for 2- and 3-wheel electric vehicles and zero-emission e-bus and truck components
• High-efficiency air conditioners and ceiling fan components

The partnership also aims to lay the groundwork for cooperation in third countries, particularly in Africa.

It aims to collaborate with the private sector to scope eligible opportunities in these supply chain segments and support an initial package of pilot projects, ideally including one project focused on clean energy deployment to Africa.

Additional investment plans and sources of funding can be developed over time. This effort would build on private sector partnerships facilitated by the U.S. Development Finance Corporation (DFC) across the solar, wind, battery, and critical minerals sectors to pursue opportunities to finance the manufacture of clean energy components.

Such investments may be in scope for India’s Green Transition Fund, which will support renewable energy, storage, and e-mobility investments in India and strengthen demand for localized manufacturing, as well as for Indian private equity fund manager Eversource Capital’s new DFC-supported $900 million fund to invest in clean technologies.

India and the U.S. also plan to collaborate with the private sector to find eligible opportunities in supply chain segments and support an initial pack of pilot projects. A vital aspect of the roadmap is building trilateral relationships with African partners committed to clean energy deployment, focusing on solar and battery storage opportunities.

The joint statement referred to the Inflation Reduction Act (IRA) of the U.S. and the Production Linked Incentive program of India and said the two countries will collaborate with the industry on policies that will strengthen demand certainty for locally manufactured clean technologies.

In October 2022, India and the U.S. reiterated their commitment to accelerating the transition into sustainable energy at the ministerial dialogue of the U.S.-India Strategic Clean Energy Partnership.