HSN Code for Solar Panels in India: Import Duty, Rates, and Classification Guide (2026)

The HSN code for solar panels in India is 8541 40, covering photovoltaic cells whether assembled into modules or not, under Chapter 85 of the Customs Tariff Act, 1975. As of the Union Budget 2026-27, Basic Customs Duty (BCD) on solar modules has been reduced to 20% (down from 40%), while solar cells carry 20% BCD (reduced from 25%). A time-sensitive change: the BCD exemption on silicon wafers under HSN 3818 00 expires on March 31, 2026, after which standard tariff rates apply.

What is the HSN code for solar panels in India?

Solar panels and modules fall under HSN heading 8541 40, which covers "photosensitive semiconductor devices, including photovoltaic cells whether or not assembled in modules or made up into panels." This is part of Chapter 85 of the ITC-HS classification.

The distinction that matters for duty purposes is between solar cells and solar modules:

• Solar cells (individual photovoltaic cells, unassembled): HSN 8541 40 11
• Solar modules/panels (cells assembled into panels): HSN 8541 40 12

Getting this wrong has real consequences. A solar cell classified as a module attracts a higher BCD rate. Customs authorities at Indian ports regularly flag shipments where the declared sub-heading doesn't match the physical goods, and the result is re-assessment, differential duty demands, and clearance delays.

Solar inverters are not classified under 8541. They fall under HSN 8504 40 11 (static converters), with a separate duty structure. If you're importing a complete solar power system with panels, inverters, and mounting structures, each component needs its own classification.

What import duty applies to solar panels and cells in India?

The duty structure for solar components was overhauled in the Union Budget 2026-27 (Notification No. 02/2026-Customs dated February 1, 2026). Current rates:

Source: CBIC Customs Tariff Schedule 2026-27, as per Notification No. 02/2026-Customs

The BCD reduction on solar modules from 40% to 20% is part of the government's effort to balance two competing goals: protecting domestic manufacturing (the original reason for the April 2022 duty hike) and keeping solar power project costs manageable. The 40% BCD had made imported modules expensive enough that some solar EPC companies reported project cost overruns of 8-12%.

ALMM (Approved List of Models and Manufacturers) compliance adds another layer. For government-funded or government-tendered solar projects, you can only use panels from manufacturers listed on the MNRE ALMM registry. Non-ALMM panels can still be imported for private installations, but they won't qualify for government project use. The MNRE has also expanded ALMM to include ingots and wafers under a new ALMM List-III, effective from June 1, 2028.

What happens when the silicon wafer exemption ends on March 31, 2026?

This is the change that solar cell manufacturers in India need to plan around right now.

Since 2022, silicon in all forms used for manufacturing undiffused silicon wafers has been exempt from BCD under Notification No. 45/2025-Customs. That exemption lapses on March 31, 2026. From April 1, standard tariff rates apply to silicon wafer imports under HSN 3818 00.

What this means in practice:

Domestic solar cell manufacturers who import silicon wafers will see raw material costs go up. Most Indian solar cell production depends on imported wafers (primarily from China and Southeast Asia). The removal of the nil-BCD benefit will squeeze margins unless manufacturers can pass costs downstream or source wafers domestically.

For importers filing BoEs, any silicon wafer shipment arriving on or after April 1, 2026 will be assessed at the standard tariff rate rather than the concessional nil rate. If you have shipments in transit, the date of filing the Bill of Entry determines which rate applies, not the date of shipment.

For solar project developers, this is an indirect cost increase. Higher wafer costs flow through to cell costs, and eventually to module prices. Projects that locked in component pricing before this change are unaffected, but new procurement will need updated cost estimates.

If you are importing silicon wafers under the current exemption, the practical step is to ensure all shipments clear customs before March 31. Any BoE filed after that date loses the nil-BCD benefit.

How do solar component imports work under the PLI scheme?

The Production Linked Incentive (PLI) scheme for solar manufacturing (announced under the National Programme on High Efficiency Solar PV Modules) offers financial incentives to manufacturers who set up or expand solar cell and module production in India.

Under PLI, eligible manufacturers can import certain capital goods and raw materials at concessional duty rates. Manufacturers who qualify under PLI tranches can claim incentives of Rs 2.25 to Rs 3 per watt of module production, depending on the technology tier and local value addition achieved.

For imports specifically:

• Capital goods for solar cell manufacturing can be imported under concessional duty routes available through the Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017
• BIS certification is required for solar modules sold in India (IS 14286 for crystalline silicon modules, IS 16077 for thin-film). This applies whether the module is manufactured domestically or imported
• PLI beneficiaries must meet minimum domestic value addition thresholds. Importing all components and only assembling in India does not qualify

The PLI scheme is separate from the BCD structure. You pay the applicable BCD on imports regardless of PLI status. The PLI incentive is a production-linked payout, not a duty concession.

How does Eximoz handle solar energy component classification?

Solar imports involve multiple HSN codes with different duty rates, changing exemptions, and regulatory requirements that vary by component type. A single solar power system shipment might include modules under 8541 40, inverters under 8504 40, mounting structures under 7308, and cables under 8544, each with its own BCD rate and compliance requirements.

Eximoz automates the classification of solar components, maps each item to the correct 8-digit HSN code, and runs pre-clearance checks against current duty rates and regulatory requirements (including ALMM and BIS certification status). When duty rates change, like the module BCD reduction or the wafer exemption lapse, the system flags affected classifications automatically. If your team handles solar import volumes regularly, take a look: eximoz.com

Frequently asked questions

What is the BCD on solar panels in India?

As of the Union Budget 2026-27, the Basic Customs Duty on solar modules (panels) is 20%, reduced from the earlier rate of 40% that was in effect since April 2022. Solar cells (unassembled) carry a BCD of 25%. Both rates are specific to HSN heading 8541 40 and are subject to change in subsequent budget announcements.

What is the HSN code for solar inverters?

Solar inverters fall under HSN 8504 40 11, classified as static converters under Chapter 85 of the Customs Tariff Act. They are separate from solar panels (8541 40) and carry a BCD of 20% with 12% GST. When importing a complete solar system, the inverter must be classified and declared separately from the panels.

Will silicon wafer import duty increase in April 2026?

Yes. The nil-BCD exemption on silicon in all forms used for manufacturing undiffused wafers (HSN 3818 00), granted under Notification No. 45/2025-Customs, expires on March 31, 2026. From April 1, 2026, standard tariff rates will apply. This directly affects domestic solar cell manufacturers who import silicon wafers as raw material.

Is there GST on solar panels?

Solar panels and modules attract 12% GST under HSN 8541 40. This was standardized in 2021 when the GST Council merged the earlier split rate (5% on panels sold as part of EPC contracts, 18% on standalone panel sales) into a uniform 12%. Solar inverters also carry 12% GST, while silicon wafers attract 18% GST under HSN 3818.

What is ALMM and does it affect solar panel imports?

ALMM (Approved List of Models and Manufacturers) is a registry maintained by the Ministry of New and Renewable Energy (MNRE) at almm.mnre.gov.in. Listing on ALMM is mandatory for solar modules and cells used in government-funded projects and projects connected to government distribution companies. Non-ALMM panels can still be imported and used for private installations. The MNRE has expanded ALMM to cover ingots and wafers (ALMM List-III), effective June 1, 2028.