A fresh wave of price increases is expected to hit the global solar industry after a major policy change by China. The move carries direct implications for Pakistan’s rapidly expanding solar market, which depends heavily on imported photovoltaic equipment from Chinese manufacturers.
In January 2026, China’s Ministry of Finance and State Taxation Administration announced the complete withdrawal of value-added tax export rebates on photovoltaic products. From April 1, 2026, export rebates on PV modules will be fully canceled, while rebates on battery-related products will be gradually phased out and removed entirely by 2027.
Industry analysts say the decision has intensified pressure on an already strained global supply chain. Market estimates suggest that removing the existing nine percent export rebate alone could push photovoltaic module prices higher by a similar margin, as exporters attempt to recover lost profitability through revised pricing structures.
Analysts at Shanghai Metals Market report that export profits for a standard 210R photovoltaic module could fall by as much as 51 yuan per unit. They describe the policy change as a structural cost shift, making it increasingly difficult for manufacturers to absorb losses without passing costs to overseas buyers.
For Pakistan, the timing is particularly significant as solar installations have surged due to rising electricity tariffs and ongoing power shortages. The country relies heavily on imported PV modules, primarily from China, exposing local project costs to global pricing shocks and policy-driven changes.
Upstream pressures are further adding to cost inflation. Prices of key raw materials such as polysilicon and silver have climbed sharply, with polysilicon rising nearly ten percent month-on-month and silver touching record highs. Analysts warn sustained increases could slow adoption among price-sensitive consumers, despite solar remaining competitive.
Also read: Check Solar Panel Prices In Pakistan
