India to Add Rs 2,641 bn in Transmission Projects by FY31
POWER & RENEWABLE ENERGY

India to Add Rs 2,641 bn in Transmission Projects by FY31

India Ratings and Research (Ind-Ra) has maintained a stable rating outlook for transmission projects for FY27 and forecasts that Rs 2,641 bn of transmission projects will be added by FY31 under the inter-state transmission system rolling plan. The agency expects annual awards of Rs 600-800 bn during FY26 and FY27 and reported that 68 projects awarded through tariff-based competitive bidding have been completed in the nine months to FY26. Only 12 of these were finished on schedule, underscoring execution challenges.

Ind-Ra observed that about 76 per cent of under-construction projects, valued at roughly Rs 2,538 bn, are concentrated in Rajasthan and Gujarat. Projects costing more than Rs 10 bn have faced an average delay of 11 months, with some exceeding two years. The agency said capital expenditure in the transmission segment should support renewable capacity growth in high concentration regions despite these delays.

India's energy requirement growth is expected to moderate to about two per cent in FY26, against four point one per cent in FY25 and seven point four per cent in FY24, as a prolonged monsoon and softer industrial activity weighed on demand. Quarterly patterns in FY26 were mixed, with one point six per cent decline in the first quarter, three point three per cent growth in the second and zero point two per cent decline in the third. Peak demand reached about 242.5 gigawatts (GW) in June 2025, an all-time high.

Renewables gained momentum in the nine months to FY26 as solar generation rose by about 20 per cent, aided by a 28.5 per cent increase in solar capacity and 30.2 GW of additions, taking installed solar capacity to 135.8 GW. India Ratings and Research forecasts full-year solar installations of 35-40 GW and warns that module prices may rise as the Approved List of Models and Manufacturers (ALMM) mandates domestic cell usage for government procurement. Wind additions are expected at five to six gigawatts in FY26, with total wind capacity near 54.5 GW by end-December 2025.

India Ratings and Research (Ind-Ra) has maintained a stable rating outlook for transmission projects for FY27 and forecasts that Rs 2,641 bn of transmission projects will be added by FY31 under the inter-state transmission system rolling plan. The agency expects annual awards of Rs 600-800 bn during FY26 and FY27 and reported that 68 projects awarded through tariff-based competitive bidding have been completed in the nine months to FY26. Only 12 of these were finished on schedule, underscoring execution challenges. Ind-Ra observed that about 76 per cent of under-construction projects, valued at roughly Rs 2,538 bn, are concentrated in Rajasthan and Gujarat. Projects costing more than Rs 10 bn have faced an average delay of 11 months, with some exceeding two years. The agency said capital expenditure in the transmission segment should support renewable capacity growth in high concentration regions despite these delays. India's energy requirement growth is expected to moderate to about two per cent in FY26, against four point one per cent in FY25 and seven point four per cent in FY24, as a prolonged monsoon and softer industrial activity weighed on demand. Quarterly patterns in FY26 were mixed, with one point six per cent decline in the first quarter, three point three per cent growth in the second and zero point two per cent decline in the third. Peak demand reached about 242.5 gigawatts (GW) in June 2025, an all-time high. Renewables gained momentum in the nine months to FY26 as solar generation rose by about 20 per cent, aided by a 28.5 per cent increase in solar capacity and 30.2 GW of additions, taking installed solar capacity to 135.8 GW. India Ratings and Research forecasts full-year solar installations of 35-40 GW and warns that module prices may rise as the Approved List of Models and Manufacturers (ALMM) mandates domestic cell usage for government procurement. Wind additions are expected at five to six gigawatts in FY26, with total wind capacity near 54.5 GW by end-December 2025.

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