ADB has announced a $650 million loan to accelerate rooftop solar deployment under India’s flagship residential scheme
The funding is expected to ease financing gaps and improve subsidy and installation flow nationwide
The assistance will enhance regulatory readiness and help India meet its rooftop solar targets under PMSGMBY, says the bank
Indian government’s flagship rooftop solar program Pradhan Mantri Surya Ghar: Muft Bijli Yojana (PMSGMBY) has secured a policy-based loan of $650 million from the Asian Development Bank (ADB).
Through this scheme, India aims to expand access to clean and affordable solar energy for 10 million households by 2027. It expects to achieve 30 GW installed capacity with this scheme. As of November 26, 2025, a total of 1.87 million rooftop solar systems had been installed under the scheme nationwide, benefiting 2.35 million households, according to the Ministry of New and Renewable Energy (MNRE).
However, lagging subsidy release and installation progress may threaten target achievement, according to an IEEFA and JMK Research & Analytics report (see PMSGMBY Boosts India’s Rooftop Solar Capacity With 4.9 GW).
Under the scheme, the government provides a 60% subsidy (financial assistance) to residential consumers for installing up to 2 kW PV systems, and a 40% subsidy for additional capacity between 2 kW and 3 kW.
With ADB’s backing, the country hopes to accelerate rooftop solar adoption and make rooftop solar systems widely accessible. It will help speed up the program, while addressing barriers to rooftop solar adoption, including financing constraints and regulatory gaps.
The loan will also mobilize private sector investment and create opportunities for manufacturers, vendors, and service providers across the renewable energy value chain. The bank’s commitment includes $3 million in technical assistance, which will help implement reforms, build institutional capacity, and promote gender-inclusive participation in the segment, stated the ADB.
