The Asian Development Bank (ADB) has approved a US$650 million loan to accelerate rooftop solar PV deployment in India under the government’s ‘Pradhan Mantri Surya Ghar: Muft Bijli Yojana’ (PMSGY) initiative.
Delivered under subprogram one of ADB’s Accelerating Affordable and Inclusive Rooftop Solar System Development Program, the ADB loan will include US$3 million in “technical assistance” and help implement the goals of the initiative. While the ADB did not specify how the finance would be used, the PMSGY programme aims to cover some of the costs of rooftop solar installations—providing a 60% subsidy for systems up to 2kW and a 40% subsidy for systems between 2-3kW—so this is a possible use of the money.
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The PMSGY programme was introduced in 2024 alongside a government investment of INR92.8 billion crore (US$1.05 billion) to grow the country’s operational rooftop solar capacity to 30GW, and deliver broader benefits for the Indian solar sector, such as the training of at least 5,000 personnel, including 1,500 women.
“The program is accelerating India’s clean energy transition by removing long-standing barriers to rooftop solar adoption, including financing constraints and regulatory gaps,” said ADB country director for India Mio Oka.
The PMSGY initiative has yielded immediate results, with India installing 4.9GW of residential rooftop solar capacity in the first half of this year, according to the Institute for Energy Economics and Financial Analysis (IEEFA) and JMK Research, and as much as 5.8GW of new rooftop capacity in the first nine months of the year.
However, translating the significant desire for projects into operational PV systems has proven more challenging. Between March 2024 and July 2025, applications for residential rooftop applications grew nearly fourfold, but three states have a conversion ratio—a measure of successful deployments as a percentage of total applications—lower than 15%, and as of July, only 14.1% of allocated government subsidies had been disbursed.
The news follows the ADB’s investment of US$331 million into a hybrid wind-solar-battery energy storage project in India in November.
